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Impact of Social Influences on Managerial Decision Making

Discuss about the Management Decision Making for Social Model.

Social influence is one of the extremely controversial aspects in almost all the organizations. social influence can be understood as the approach or way by which the individuals impacts the actions, feelings and thoughts of other people by an indirect or a direct manner (AKAR, YÜKSEL and BULUT, 2015). The impact of social influences is of such a greater context that the individuals revise or change their decisions and estimations which affect their decision making approach (Lorenz, et al., 2011). The social influence is not only imposed by the closed relatives or the higher authorities but they can be even come from peers, colleagues or other individuals who people don’t even recognize such as some published articles or any other things and these are known as the intangible influential groups (Sridhar and Srinivasan, 2012). Social influence can impose positive as well as negative impact over the thought process of an individual which results into a rational or irrational decision making. In several organizations the managerial decision making is the result of the high social influences which results into number of negative outcomes in case of unethical and irrational decision making. The essay will provide in-depth knowledge of few of the highly recognized components which impacts the decision making of the individuals (Stallen and Mirre, 2013). These components show that in what manner the individuals revise or change their previously taken decisions because of the high social influences. Later to the understanding of these individual components the essay will conclude with an overall analysis of the impact posed on the managerial decision making and about theissues which are the end results of these social influences (Kim and Srivastava, 2007).

Social influences have a direct impact over the managerial decision making in the organizations. The influences can be explained b y various experiments and studies undertaken by recognized professors and analysts. Following are the few studies and experiments which willexplain the impact of social influence over the decision of the individuals.

To understand the impact of social influence one of the highly recognized model or approach is the Classic study of Solomon Asch. The study laid emphasis over the influence and impact of social conformity over the individual decision making process. In the 1950s there were few experiments which were undertaken by Solomon Asch for analyzing and understanding the affect and impact over the behavior and thoughts of individuals by the influence of others. In the study conducted by Solomon Asch, there was a group of few individuals who participated in the experiment. There was presented an array of printed lineswhich were of diverse lengths named a, b and c. All the contestants were than shown one more line segment marked x. and then all the participants were asked to identify and recognize the most identical line segment to the line x in terms of length from the earlier shown printed lines a, b and c.

Solomon Asch’s classic study into the impact of social conformity on decision making

This was an ordinaryperceptual task which was givento the participants. The results of the study shows that when the participants answered the question individually theychosen the correct line. But there were also included some confederates (they are the people who already know the result but basically work for the researchers to identify the actual results by participating in the experiment) in the experiment as the usual participants. And it was asked to the confederates to select the wronglineintentionally so that the impact of their answer can be judged. It was identified that approximately 75 percent of the candidates have conformed to the group force and influence at least for once by changing their answers and selecting the wrong line. This experiment was an efficient example for illustrating the impact of normative influence as the candidates have revised their answers so that they can avoid the situation of being standing out (Cherry, 2016).

This study of Solomon Asch has clearly indentified the impact of social influence or conformity over the decision of individuals. In present scenario, such influences are also identified in the organizations where people take decisions because of the peer group. If the maximum number of employees are agree on a single decision or policy then the other employees also get impacted by them and to have majority benefit they change their though process and agrees over the decisions and view of the majority group. For example, if any organization plans to execute any kind of change in the organization then it that situation suchdilemmas are faced by the company in regards with the involvement of the employees in change management program.Thus the experiment conducted by Solomon Asch is still validates in number of organizations as well as at various other places (Dietrich, 2010). Another corporate example of social conformity is Wal-Mart, earlier the organization was highly recognized for taking use of irrational practices, taking use of labors by violating the various labor laws, wages act etc. This scenario keeps of growing as there was a social conformity that the employees who will raise their voice will be turned out of the organization. And thus a group of employees adapt the situation and has a direct impact over other workers too. Thus it shows that social conformity restricts individuals to arise their voice (Ruiz, 2014).

Stanley Milgram, one of the highly recognized psychologists of Yale University conducted an experiment which gained high recognition by the name of Milgram experiment. In the year 1963, an experiment was conducted by Stanley Milgram to analyze the impact of obedience to authority figures. It was a sequence of various social psychology tests. These tests were performed to analyze and determine the participants’ willingness to obey some authoritative instruction given by the authoritative figure. These acts have a direct conflict with the participants’ individual conscience. In this experiment, there is involvement of a teacher, the one who undertakes the experiment, a confederate who only acts like a usual volunteer participant and a genuine participant who will took part in the experiment. There was a situation created by which the participants canhave a faith that the role of the confederate is randomly assigned as a participant (Russell, 2011).The instructions were given to both the participants that they had to give a shock to an individual while conducting a learning task over each wrong answer. The intensity of the shocks was also to be increased with every next wrong answer given by the person. And in case where participants face difficulty and questioned this activity, they have been encouraged by the researchers to continue. There were reactions from the person side that was experiencing those shocks such as complaints of heart pain, various noises of hurting and even shows seizure-like conducts.

Stanley Milgram’s classic study of the influence that obedience to an authority figure can have on decision making

It was analyzed that number of participants had shown their disinterest in continuing with the experiment. They have also checked the confederate in between. Many of the participants remained continued with their experiment after being guaranteed that they will not be liable for any non-happening event. When it was identified that the participants are trying to halt the test but again the researchers encouraged them verbally. And even after the encouragement the participants do not wished to continue with the experiment and halt it thenautomatically the experiments come to an end. And in other cases the experiments only get finished when the participant has given the person with a maximum shock of 450-volt and that too 3 times in a row (Boundless, 2016).

From the results it was analyzed that only a very squat percentage i.e. one percent of participants has given the maximum voltage shock to the person. In the initial series of experiments, a total of sixty five percent have given 450-volt shock but it was a bit uneasy for them to do so. Maximum of the candidates halt the experiment in between and have questioned the test but then also around 26 participants out of 40 have continued administering the full shock even though it was halt by the confederate too (Boundless, 2016). From the analysis of these results it was evaluated that to obey the orders of the authoritative figure the participants even undertake such activities also which are extremely harmful in nature.

In the organizations the similar things can be identified when the mangers or the subordinates have to take irrationaldecisions which can have negative implications for the employees and the organization. These decisions are takenbecause of the social influence of the higher authorities. The mangers cannot disobey the orders of eth higher authorities and thus have to take decisions against their individual conscience (Vieider, 2009). Another corporate example of influence of obedience can be seen in the recognized company, Apple. Steve Jobs is re cognized for both positive as well as negative leadership traits. As the founder of Apple, Steve Jobs have terminated several effective and efficient employees as they try to work on improved ideas. Due to the influence of obedience no other employee raised their voice against such unethical termination. This is one of the example which shows that influence of obedience can result into irrational decision making (Sanders, 2017).

There was a study conducted by a well recognized management professor named Fred Luthans. The professor has his specialization in organizational behavior and therefore there are several studies conducted by him. With the technology globalization, there has been experienced increasing use of computers and other automated services. Previously in almost all the organization people take use of typewriter for any paper work in the organizations. But with thechange in technology everything is now done with the use of computer and other technology. There werevariousdifferentmanners in which the information was used to be presented and the primary means was with the use of typewriter, a paper based info. That information presented through a usual typewriter has a different impact over an individual in comparison with the information presented in a computer-based print out information (Noyes and Garland, 2008).

Decision Making Components and Organizational Impact

From the study it has been analyzed that people are more comfortable in understanding the information presented in a computerized print out rather than the information presented by a typewriter. The participants have consumed lesser time if they have read they instruction through a computer print out. There were several positive outcomes realized when the information was presented in a much appropriate way i.e. computerized print out. The positive implications were such as faster under stranding of the things, high concentration and rapid outcomes with minimum faults.

In various organizations, still there has been taken use of the typewriters for providing printed information. But if analyzedfrom overall aspect it is true that the computer printout is more beneficial. There is a social influence laid by the way of information has been presented. These influences directly linked with the end results of the tasks.

Whenever there is a group setting then there are utmost chances of getting influenced by the behaviors, feelings and thoughts present around. The individuals get influenced by both the informational as well as normativesocial influence. The groups possess powers which can easily influence an individual. Groupthink is another aspect of group conformity. Groupthink can be explained as the change in the thoughts and opinions of the several group members so that they can have an alignment with opinions and consensus of the overall group. In the group decision making, those decisions and actions are taken which an individual   l will not generally take if he is outside the group.

There are always been taken more extreme decisions while individuals are the apart of a group. But it is also a fact that groupthink results into hindrance of individual opinions and thoughts. There has been elimination of the individual opinions which results into declined diverse thoughts and ultimately there are several negative implications because of the wrong decision making by the group (Sims and Sauser, 2013).

There are number of causes which lead to occurrence of groupthink. For example., the groupthink in decision making takes place when there is a vibrant connection among the group members and the group is extremely cohesive then in that case it leads to groupthink decision making because maintaining the group harmony is more vital then taking correct decisions. Another example of groupthink is when the leader of the group is authoritative as well as directive. In that case, the group members are discouraged of making a stand and disagree with the group leader. Thus it leads to groupthink. If the group members do not take use of innovative thoughts and alternative discussions then there are utmost chances of groupthink.

There are some real world examples of groupthink which have impacted in a deeper sense. One of the examples of groupthink is collapse of Swissair. Because of the potential financial ability of the organization, the airline was recognized by the name “Flying Bank” (Cocklin, 2004). The organization had a strong belief that they are invulnerable in nature. This has resulted into failing of questioning the highly gross mismanagement and poor decisions of the airlines and as a result the airlines got bankrupt. This is a world recognized example of groupthink. There are also few other examples of groupthink such as Vietrnam war’s escalation, the Bay of Pigs invasion, failure of the US regarding anticipating the attack over Pearl Harbor etc (Kilhefner, n.d.). All these are the real word instances which had taken place because of one common element that is groupthink.


From this overall essayit can be understood that the social influence possess power to impact the decision making of the managers as well as the individuals. These social influences acts as a powerful source to get modifications and changes in the thoughts and opinions of the individuals. From the individual component first i.e. the classic study of Solomon Asch it has been evaluated that the social conformity ids one of the major factor in reversing the decisions taken by then individuals. From the individual component second i.e. classic study of Stanley Milgram it has been identified that just to obey the authorities the individuals can work by going against their personal conscience. From the individual component three, Fred Luthans’s study it has been analyzed that the manner in which information is presented also impacts an individual and the associated actions.

From the last individual component i.e. groupthink it has been critically evaluated that the groups possess powers to influence individuals to modify their decisions as well as restricts individual thoughts. Thus all such studies show that in almost all the organizations the managerial decisions are also impacted by the similar social influence. This gives rise to irrational decision making. These irrational decisions decreases the trust of the employees over the organization as well as over the higher authorities, it is necessary that decisions must be free of these social influences so that equity can be maintained in the organizations. The lesser the impact of the social influences will be the greater will be the employee engagement and equity in the organizations. Thus it is essentialthat all the managerial decisionsmust be free from the impact of social influences.


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Ruiz, A., 2014. Labor advocates say Walmart's low wages and poor treatment of workers set a bad example for New York-based businesses, Daily News, New York, Accessed on: 27th January, 2017, Accessed from:

Russell, N.J.C., 2011. Milgram's obedience to authority experiments: Origins and early evolution. British Journal of Social Psychology, 50(1), pp.140-162.

Sanders, 2017. 8 Unforgivable Leadership Mistakes Steve Jobs Made, Accessed on: 27th January, 2017, Accessed from:

Sims, R.R. and Sauser, W.I., 2013. Toward a better understanding of the relationships among received wisdom, groupthink, and organizational ethical culture. Journal of Management Policy and Practice, 14(4), p.75.

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