Discuss about the Biases Influence The Managerial Decision Making.
Perceptual error, attribution, and biases influence the managerial decision making in an organization. However, in an organization, different people have different types of viewpoints and attributions. This leads the managers to take a decision based on their perceptions (Summerfield and De Lange 2014). However, often the managers give opportunity to the individuals based on their performance. Often perceptual error and the biases lead the manager to take a wrong decision regarding the employees. Negative attribution and perceptual error often leave a negative effect on the managerial decision-making process. As for example, it is often seen that perceptual error of the managers often leads them to take a wrong decision during the appraisal of the individuals. Therefore, a bias is another factor that leads the managers to create favoritism during the promotion of the employees (Lepora and Pezzulo 2015). This study deals with the impact of perceptual error, biases, and attribution on the managerial decision in the context of Wesfarmers. The thesis statement of this current essay is to identify the role of biases, perceptual error, and attribution in influencing the managerial decision in an organization. The scope of this study is to analyze the effect of perceptual error and biases on the decision-making process of the organization. This study highlights various theories related to the perceptions and managerial attributes. On the other hand, the application of the theories on managerial decision-making will be discussed in this section. Therefore, the recommendations will be discussed to improve the managerial decision-making process.
According to Goetsch and Davis (2014), perception is an interpretation of the sensory information in order to express and understand the presented information in an organization. However, it can be said that perception is the viewpoints or way of understanding the information. Perceptual error refers to the wrong opinion of an individual about others. However, what people think, believe or see is not always right. This occurs due to the perceptual error. On the other hand, biases refer to the discrimination or favoritism process in an organization. However, often the managers in an organization show favoritism while giving an opportunity to the employees. Therefore, attribution is an action, which is taken by an individual based on the situation. In the context of Wesfarmers perceptual error is a big factor that influences the decision-making process of the managers in this organization. It has been received that the HR managers of Wesfarmers are not able to give proper appraisal to the employees due to their perceptual error (Wesfarmers.com). On the other hand, the managers show favoritism in this organization during their decision-making process.
As commented by Bridge and Dodds (2018), generalized perception may leave both positive and negative impact on the decision-making process of the mangers. However, individuals have a tendency to judge the people after observing their one or two characteristics. As argued by Lepora and Pezzulo (2015), this type of judgment can leave both positive and negative impact on the individuals. As for example, if the manager is able to generate a good impression from the behavior of the individuals then it will be favorable for the individuals. On the other hand, if any attitude of the individuals is not preferred by the managers then it can leave a negative impression. As a result, a perceptual error occurs and the managers take a wrong decision regarding the individuals. On the other hand, the managers often give preference to their closed one or the preferred candidates. This creates biases as a result, inequality occurs during the decision-making process. As stated by Koch et al. (2015), attribution is a process that leads the managers to develop a conclusion based on the factors that leave an effect on the behavior of the individuals.
In the context of Wesfarmers, their employees are not satisfied as they have no scope to share their ideas in managerial decision making. However, the managers do not allow the employees to take part in the organizational decision-making process. This is a big drawback of the managerial decision-making in this organization. On the other hand, the perceptual error is another issue of the decision-making process in this organization. Therefore, the managers are biased while taking a decision based on the employee performance. In order to deal with this situation, the managers of this organization need to take different theories and models. One of the vital attribution theories is Weiner Attribution Theory. According to this theory, individuals need to understand what they do and why they do. Effort, ability, and task difficulty are the main factors that affect the behavior of the people (Pekrun and Marsh 2018). By applying this theory the mangers of Wesfarmers will be able to understand the behavior of the people based on which they will take the decision. This theory will help the managers to identify the reasons, which lead the people to show different behaviors.
Kelley’s theory of causal attribution is another vital theory of attribution. According to this theory, consistency, information, agreement, and distinctiveness are the major factors that influence the decision-making process of the managers (Stiensmeier-Pelster and Heckhausen 2018). Agreement is the extent to which the attitude of one individual is similar to another individual. Consistency focuses on the phase where the individuals show similar behavior. Distinctiveness is a process where individuals exhibit similar behavior on different occasions. By applying this theory, the managers of Wesfarmers are able to understand the different behaviors of the individuals on different occasions. This will be helpful for the managers to take right decision based on the critical situation. However, in Wesfarmers, the management is very strict as a result, the employees are not able to involve in the organizational decision-making process. Therefore, the managers have a perceptual error as they take decision based on the one and two characteristics of the employees. This is a big issue in this organization. On the other hand, the managers have not the ability to carry out an in-depth analysis of the employee behavior. As a result, they often take a wrong decision, which also affects the performance of the employees in this organization. Action based theory of perception highlights that individuals need to observe the activity as well as the characteristics of the people while taking a decision (Weiner 2018). However, this theory is helpful to observe the various characteristics of the individuals instead of a single character. By using this theory the managers of Wesfarmers will be able to measure each character of the employees while taking the decision related to employee performance. This allows the manager to take the right decision.
Ambiguity model of decision-making is a vital model that influences the managerial decision-making in an organization (Scherer 2018). According to this model, decision can be taken under uncertainty in a number of situations. In the context of Wesfarmers, the HR managers take a decision quickly by analyzing one or two characteristics of the individuals. However, application of the ambiguity model will enable these managers to take a necessary decision by reducing the perceptual error and biases. Reduction of biases is crucial during the managerial decision making in an organization. In the context of Wesfarmers, the managers isolated the employees in the decision-making process and they focus on a few characteristics of the employees while taking a decision. This creates biases as well favoritism in this organization. According to the social identity theory different individuals have different identities, which highlight their different characteristics. Such different types of characteristics make the one individual different from other. By following this theory the managers of Wesfarmers will be able to understand the different attitudes and attributes of the individuals. This will strengthen the decision-making process of the management.
According to the above analysis it has been received that the above theories will be helpful for Wesfarmers to improve their managerial decision-making process by reducing the biases and conflicts. It is crucial to observe the performance as well as the behavior of each employee while taking a decision. Perceptual can vary based on the individuals. Often two individuals observe the same situation but they generate different perceptions. Stereotyping is a vital factor that influences the perception of the individuals (Bridge and Dodds 2018). Stereotyping is a judgment process that leads the individuals to draw a conclusion based on their perceptions. Hence, it can be said that stereotyping enables the managers to take a quick decision by observing only one or two features of the employees. As criticized by Oliveira et al. (2018), perceptual error enables the manager to take quick decision however, it often hampers the decision-making process. As for example, in order to take quick decision often the managers observe a single characteristic of the employees (Calabrese et al. 2018). This is not sufficient to take proper judgment. As a result, the managers take a wrong decision. In Wesfarmers, the employees are not satisfied with the decision making process. This is due to the perceptual error of the managers in this organization. As a result, the performance of the employees is affected.
On the other hand, the biases in the organization also influence the decision-making process. As criticized by Gong et al. (2018), favoritism is a process that influences the managerial decision-making by giving an opportunity to their preferred candidates. However, for an organization, it is important to reduce biases while taking a decision regarding the employee performance. In Wesfarmers, the managers are biased that hampers the decision-making process of the managers. A transparent decision-making process should not include favoritism and inequality. It is important for Wesfarmers to treat each employee equally. However, biases also hamper the personality of the mangers while taking a decision. On the other hand, attribution focuses on the different behaviors of the employees in Wesfarmers. In order to take a good decision it is important for the managers to observe every characteristic of the employees. Managerial decision-making is a process to make a conclusion based on the several activities of the individuals in an organization. Based on the above analysis it has been received that the attribution theories help the managers to understand the cause of human behavior as well as their own behavior. Hence, the managers are able to know the exact reasons of their action during the decision-making process.
Recommendations and Conclusion
From the above analysis, it has been found that biases, perceptual error, and different attribution influence the managerial decision-making process in HR department of Wesfarmers. In order to deal with this situation, it is crucial for HR managers to reduce the inequality while taking a decision regarding the employees of Wesfarmers. Reduction of the biases will be helpful for the HR managers to make transparency during their decision-making process. Therefore, it is crucial to reduce perceptual error during the decision making process. In order to do this, it is important for the managers to observe every characteristic of the employees while taking the decision regarding the performance of the employees. This will help the managers of the Wesfarmers to improve the decision-making process of the HR managers. On the other hand, application of the attribution theories will lead the HR managers to observe different types of behavior of the employees and the reasons of such type of behavior. On the other hand, by providing empowerment to the employees the managers of Wesfarmers will be able to involve the employees in the organizational decision-making process. This will reduce the current decision-making issue in this organization. Moreover, by gathering feedback from the employees the HR managers of Wesfarmers are able to understand the attribution of the employees and influence them to take part in the organizational decision-making process.
This above study highlights the different factors of the decision making process in Wesfarmers. It has been addressed from the above analysis that perceptual error, biases, and attribution play an important role in influencing the managerial decision-making in an organization. On the other hand, from the critical evaluation, it has been received that perceptual error has both positive and negative effect on the decision making process. It can be concluded that Wesfarmers needs to reduce biases and follow the attribution to improve their decision-making process by involving the employees.
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