Decision-Making
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Three important biasing factors
• Different units’ struggle to obtain scarce
resources in a competitive environment;
• an organizational culture in National
Aeronautics and Space Administration
(NASA) that contributed to the
censoring of information;
• a regulatory environment that was
insufficient for the decision-making task.
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Decisions are shaped by four
independent factors
• Perceptions of current problems facing
the organization;
• Potential “solutions,” ideas or actions
that individual members of an
organization wish to champion
(e.g., the adoption of a new computer
system, creation of a new office or
function);
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Decisions are shaped by four
independent factors
• Decision-making opportunities, meetings
or committees that are assigned to make
a recommendation for action;
• Participants, individuals who are present
at decision-making opportunities.
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Politics, Conflict, and DecisionMaking
• Decision-making in organizations is
affected by individuals’ bounded rationality,
political considerations are assumed to
come into play because there is often
uncertainty surrounding decision-making
processes—uncertainty
about
which
objectives are most important to an
organization and what means should be
used to pursue a given objective
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Decision Processes
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.
Constraints on DecisionMaking
• One constraint on decision-making,
and thus on potential conflict
surrounding decisions, is the existence
of previous decisions that commit
organizational resources to certain
courses of action
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.
Constraints on DecisionMaking
• One constraint on decision-making,
and thus on potential conflict
surrounding decisions, is the existence
of previous decisions that commit
organizational resources to certain
courses of action
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.
Agenda Setting
• Defining what issues will be discussed and
in what order
Controlling Information
• Information is part of the communication
process within organizations
Forming Coalitions
• decision-making outcomes are influenced is
through the selection of individuals to
participate in a decision-making group
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STRATEGIES OF POWER AND
DECISION-MAKING
Mentor
Innovator
Facilitator
Broker
Monitor
Producer
Coordinator Director
External Focus
Internal Focus
Flexibility
Control
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How Companies are Changing
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•
•
“Cool” Companies
Believe casual days are
progressive
Believe titles are obsolete
Don't impose on employees'
personal time
Allow staff to come and go as
they please
Offer all employees stock
options
Let employees make decisions
that affect their work
Offer assistance with childcare
Have minimal bureaucracy (red
tape)
•
•
•
•
•
•
•
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“Old” Companies
Think casual Fridays are pitiful
Charge employees for perks and
incentives
Hold events on employee time
Have flex time: but only
between 7:30 a.m. and 6:30
p.m.
Hide financial results from their
employees
Encourage employee input -but rarely act on it
Employ rigid hierarchies (chain
of command)
Stop at “open door” policies
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Organizational Behavior
• OB studies what people do in an
organization and how that behavior
affects the performance of the
organization.
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• Effective manager vs. successful
manager
• Management duties
– What managers do
– Management roles
– Management skills
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Management functions
• Planning
• Organizing
• Leading
• Controlling
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Management functions
• Interpersonal roles
• Informational roles
• Decisional roles
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Management skills
• Technical skills
• Human skills
• Conceptual skills
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Technical skills
• Technical Skills. Technical skills involve
skills that give the managers the ability and
the knowledge to use a variety of techniques
to achieve their objectives. ...
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Human skills
• The human or the interpersonal skills are
the skills that present the managers' ability
to interact, work or relate effectively with
people. These skills enable the managers to
make use of human potential in the
company and motivate the employees for
better results.
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Conceptual skills
• Conceptual skills are the skills managers
must have to think and to conceptualize
about abstract and complex situations.
Using these skills, managers must be able to
see the organization as a whole, understand
the relationships among various submits,
and visualize how the organization fits into
its broader environment
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Goals of Organizational
Behavior
• Explain, predict, and
• control human behavior
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Organizational behaviour
• Frederick Taylor (1856-1915) ‘the father of
scientific management’
• Focus:
– To select the best people for the job;
– To instruct them in the best methods;
– To give financial incentives in the form of piece
work
• One problem: ‘group norms’
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• The ‘instruction in best methods’ involved
breaking down a manual task into its
component activities, identifying the best way
of carrying out those activities and then
teaching the workers to copy the approved
method. This can be seen as treating the
workers as little better than automatons – but
it is also the way the sporting coaches often
work
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• The individual workers were encouraged to
maximize output by paying them piece-rates
e.g. by the units processed.
• One difficulty with this is that workers learn
that increasing output can in fact lead to the
piece-rate being adjusted in a downward
direction. Maximizing output can also be
physically and mentally exhausting. Groups
of workers therefore tend to converge on an
agreed output rate which does not require a
constant 100% effort.
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Leadership: types of authority
Position power
• Coercive power – able to threaten
punishment
• Connection power – have access to those
who do have power
• Legitimate power – based on a person’s
title conferring a special status
• Reward power – able to reward those who
comply
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Coercive
• Coercive power is conveyed through fear of
losing one's job, being demoted, receiving a
poor performance review, having prime
projects taken away, etc. This power is
obtained through threatening others
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Legitimate power
• Legitimate power comes from having a
position of power in an organization, such as
being the boss or a key member of a
leadership team. This power comes when
employees in the organization recognize the
authority of the individual. For example, the
CEO who determines the overall direction of
the company and the resource needs of the
company.
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Reward power
• Reward power is conveyed through
rewarding individuals for compliance with
one’s wishes. This may be done through
giving bonuses, raises, a promotion, extra
time off from work, etc. For example, the
supervisor who provides employees comp
time when they meet an objective she sets
for a project.
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Bases of Power
• The concept of power derives its ultimate
meaning from the 2 strong bases of power.
• Informal Power refers to the power that comes
from an individual’s unique characteristics.
These are the most effective because personal
skills, traits and knowledge influence personal
power.
• Formal Power refers to the power that
establishes because of the individual’s position in
an organization.
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Organizations and Individuals
• Impact of organizations on individuals has
been based on studies of full-time,
permanent workers
• Another growing trend is home-based work,
or telecommuting, in which people work
from their homes and use electronic
communications to link with their
employers (Lozano, 1989)
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Organizations and Individuals
• Clerical work can be done this way, as can
the work of some professionals such as
editors and professors.
• Home workers see themselves as having
more freedom than their office-bound
counterparts, and such arrangements can
allow them to deal more effectively with the
integration of work and family life
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• Organizational policies and practices affect
the economic outcomes of individuals,
organizations are key components of the
system of social stratification
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Weber’s ideal type Organizational Structure
A clearly defined division of labor, with different tasks
and responsibilities assigned to specific individuals and
offices or subunits
A hierarchy of authority in which decisions made by
lower-level individuals and offices are subject to review
(and possible revision) by those at higher levels
The use of written rules and documents to govern
practice and decisions, promoting consistency across
individuals and subunits or particular jobs (versus
personalisticties)
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Weber’s ideal type Organizational Structure
The separation of home and office, such that
organizational resources are clearly distinguished from
individuals’ private, personal resources, and public,
official roles are distinguished from private,unofficial
ones
Appointment of members on the basis of their
qualifications for particular jobs (versus personalisticties)
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Formalization
• Extent to which task assignments, procedures
for carrying out work, and other prescribed
aspects of organizational operations are
codified—made relatively permanent in a
written record
• Formalization involves organizational control
over the individual (Clegg and Dunkerley,
1980) and thus has ethical and political
implications, in addition to those involving the
efficiency and effectiveness of organizations.
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Disadvantage of formalization
• May prevent members from responding to
problems in an effective way, especially when
the problem is not one that was anticipated by
the rule-makers
• Presence of many rules may slow work
processes in ways that are not productive for
an organization
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Centralization
• Distribution of power within an organization
• The level and variety of participation in
strategic decisions by groups relative to the
number of groups in the organization
• The concept of centralization refers to the
degree to which decision-making responsibility
and power in an organization
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Control Graph
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Sources of Formal Individual
Power
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Legitimate Power
• The power to monitor and use the
organization’s resources in order to
accomplish organizational goals. For
example Firing, demotion, & subordinate’s
authority. Another example is that of a CEO
who uses a Private Jet to travel.
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Reward Power
• The power that allows you to give pay
raises, promotion, praise, interesting
projects, and other rewards to your
subordinates. Moreover, there is a limit to
the number of rewards, however, it can be a
great tool to motivate subordinates.
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Coercive Power
• The power to punish or to withhold a
punishment. Punishments have negative
side effects and should be used with
caution. Furthermore, punishments can be:
Suspension to demotion
• Termination
• Unpleasant job assignments
• Withholding of praise and goodwill
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Sources of Informal Individual Power
• Expert Power – An informal concept of
power that stems from superior ability or
expertise. In this, the group members will
tend to consult this person (the expert) for
advice or help on a project. However, it is
this dependency is what gives the individual
power over their peers.
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Referent Power
• Fame is a critical aspect of referent power.
However, this fame could be in the field
of film, sports, music stars, etc. Moreover,
agreeable, conscientious, and giving people
are also awarded referent power. People with
referent power possess high expertise. Their
ability to obtain resources, and also to secure
their surroundings is what provides them
referent powers.
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Charismatic Power
• Intense form of referent power that comes
from someone’s personality. It also comes
from physical attributes or abilities that
induce others to follow and believe in that
person.
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Overview Power of Departments in Industrial Firms
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SHIFTS IN POWER
• Managers and the managed in organizations at
the same time come to influence each other
more effectively and thereby generate joint
power as the outcome of a better command
by the organization over its technological,
economic, and human resources in the service
of certain objective
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POWER OUTCOMES: COMPLIANCE AND
INVOLVEMENT
• The most frequent consequence of the
exercise of power is compliance. This
outcome is so common that it is almost
boring. People come to work on time, do
what their bosses desire, and produce their
goods
or
deliver
their
services.
Organizational units generally also comply
with demands of their superiors.
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CONFLICT
• Power is obviously important in decisionmaking.
Conflict
arises
whenever
individuals or groups perceive differences
in their preferences involving decision
outcomes, and they use power to try to
promote their preferences over others’
preferences.
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COMPONENTS OF CONFLICT SITUATIONS
Four components of the conflict process
1. first is the parties involved
2. field of conflict
3. dynamics of the conflict situation
4. Boulding’s model is “the management,
control, or resolution of conflict
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Leadership
• Leadership is a subject that has long excited
interest among people. The term imply
images of powerful, dynamic individuals
who command victorious armies, direct
corporate empires from atop gleaming
skyscrapers, or shape the course of nations.
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• The exploits of brave and clever leaders are the essence
of many legends and myths.
• Much of our description of history is the story of
military, political, religious, and social leaders who are
credited or blamed for important historical events, even
though we do not understand very well how the events
were caused or how much influence the leader really
had. The widespread fascination with leadership may be
because it is such a mysterious process, as well as one
that touches everyone’s life
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Leadership: types of power
Personal power
• Expert power: holder can carry out
specialist tasks that are in demand
• Information power: holder has access to
needed information
• Referent power: based on personal
attractiveness or charisma
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Expert power
• Expert power comes from one’s experiences,
skills or knowledge. As we gain experience in
particular areas, and become thought leaders
in those areas, we begin to gather expert
power that can be utilized to get others to help
us meet our goals. For example, the Project
Manager who is an expert at solving
particularly challenging problems to ensure a
project stays on track.
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Referent power
• Referent power comes from being trusted
and respected. We can gain referent power
when others trust what we do and respect us
for how we handle situations. For example,
the Human Resource Associate who is
known for ensuring employees are treated
fairly and coming to the rescue of those
who are not.
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Leadership styles
decision-making
implementation
autocrat
democrat
directive
permissive
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Directive autocrat: makes decisions alone: close
supervision of implementation
Permissive autocrat: makes decisions alone:
subordinates have latitude in implementation
Directive
democrat:
makes
decisions
participatively:
close
supervision
of
implementation
Permissive
democrat:
makes
decisions
participatively: subordinates have latitude in
implementation
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Leadership styles
• Task orientation – focus on the work in hand
• People orientation – focus on relationships
Where there is uncertainty about the way job is to
be done or staff are inexperienced they welcome
task oriented supervision
• Uncertainty is reduced – people orientation more
important
• Risk that with reduction of uncertainty, managers
have time on their hands and become more task
oriented (interfering)
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Functions of Leadership
• Functions include:
planning and organizing, problem
solving,
clarifying,
informing,
monitoring, motivating, consulting,
recognizing, supporting, managing
conflict and team building, networking,
delegating, developing and mentoring,
and rewarding
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Components of Leadership
• Individual Characteristics.
•
•
•
•
•
The ideas expressed thus far have implied strongly
that individual characteristics are crucial for the
leadership role
“Surgency” (or extraversion)
Conscientiousness
Emotional stability
Agreeableness or cooperativeness
Intellect (Digman, 1990).
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Leader Behavior and Styles
Four styles of decision-making:
1. Authoritarian (or autocratic)
2. Consultative
3. Delegative
4. Group-based (or participative)
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Follower/Situational
Characteristics
The recognition that the importance of particular
behaviors for being a leader may depend on
particular situations that a group or organization is
facing led to a number of studies focusing on the
conditions that affect leadership
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OUTCOMES OF LEADERSHIP FOR
ORGANIZATIONS
• Satisfaction and Productivity
• Leadership Succession - Leadership or
managerial succession takes place when a
person in a leadership position is replaced
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LEADERSHIP IN THE VOLUNTARY
ORGANIZATION
• The situation is somewhat different in the
voluntary organization, in which formal
leaders are elected to office, or in which
members have at least some official input
into who is chosen for leadership roles
• Tendencies toward oligarchy exist in
business organizations as well, of course
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Assignment - 2
• A software development dept. Want to
improve productivity by encouraging the
reuse of existing software components. It
has been suggested that this could be
encouraged through financial rewards. To
what extent do you think this could be
done?
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Question - 2
• Newspapers often report on the vast sums of
money that are paid to the top executives of
many companies. Does this mean that these
people are at a low level in the Maslow
hierarchy of motivation? Do they really
need all this money to be motivated? What
do you think the significance of these
salries really is?
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Question - 3
• Identify three incidents or times when you felt
particularly pleased or happy about something
to do with your work or study. Identify three
occasions when you were particularly
dissatisfied with your work or study. Compare
your findings with those of your friends and
try to identify any patterns
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Stress Management
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Stress
• Stress is a feeling of emotional or physical
tension. It can come from any event or
thought that makes you feel frustrated,
angry, or nervous. Stress is your body's
reaction to a challenge or demand. In short
bursts, stress can be positive, such as when
it helps you avoid danger or meet a
deadline.
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Are you STRESSED?
What stresses you out?
How do you currently handle stress?
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What Is Stress?
Stress is the body’s automatic response to
any physical or mental demand placed on it.
Adrenaline is a chemical naturally produced
in our body as a response to stress .
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Is All Stress Bad?
 Moderate levels of stress may actually improve
performance and efficiency
 Too little stress may result in boredom
 Too much stress may cause an unproductive
anxiety level
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Identifying Stressors
Situations, activities, and relationships that
cause ‘trauma’(shock/ upset) to one’s
physical, emotional, or psychological self
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Stressors
•School
•Work
•Family
•Relationships
•Legal
•Finances
•Health/illness
•Environment
•Living Situation
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Negative Effects of Stress
1. Physical
- Weight gain/loss
- Unexpected hair loss
- Heart palpitations
- High blood pressure
2. Emotional
- Mood swings
- Anxiety
- Can lead to depression
• Can also lead to unhealthy coping strategies
(i.e. alcohol, drugs, etc)
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Managing Stress
Stress Relief Strategies
1. Body relaxation
excercises
- breathing techniques
- guided imagery
2. Physical exercise
-yoga
-work out routine
3. Meditation
4. Counseling
-talk therapy
-life coaching
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Other Helpful tips
 Changing perceptions and expectations
 Break jobs/tasks into manageable parts
 Set reasonable/realistic goals
 Avoid procrastination
 Set boundaries
 Don’t compromise your values/beliefs
 Schedule “me” time
 Avoid caffeine
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Benefits of Stress Management
Physical health gets better
more energy and stamina
Emotions stabilized
positive attitude
hopeful/happier
Ability to focus improved
able to learn and achieve
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Relax
• Our brain fires electrical waves at 14 or more cycles a
second.
• These are beta waves and are great for getting tasks
done, but not for learning new things.
• Taking a few minutes to relax deeply slows your brain
waves down.
• These slower waves are alpha waves.
• They occur at between 7 and 14 cycles a second
• Studies show alpha waves improve learning.
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Hierarchical team organization
Large projects often distinguish levels of
management:
Leaf nodes is where most development gets done; rest of tree is
management
Different levels do different kinds of work—a good
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programmer may not be a good manager
Hierarchical team organization
– Status and rewards depend on your level in the
organization
– Works well when projects have high degree of certainty,
stability and repetition
– But tends to produce overly positive reports on project
progress, e.g.:
• Bottom level: “We are having severe trouble
implementing module X.”
• Level 1: “There are some problems with module X.”
• Level 2: “Progress is steady; I do not foresee any real
problems.”
• Top: “Everything is proceeding according to our
plan.”
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Chief Programmer Team
• What do the graphics imply about this team structure?
• Chief programmer makes all important decisions
– Must be an expert analyst and architect, and a strong leader
•
•
•
•
Assistant Chief Programmer can stand in for chief, if needed
Librarian takes care of administration and documentation
Additional developers have specialized roles
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Pros and cons of this team structure? Will you use
this organization?
Matrix organization
• Organize people in terms of specialties
– Matrix of projects and specialist groups
– People from different departments allocated to software
development, possibly part-time
• Pros and cons?
– Project structure may not match organizational structure
– Individuals have multiple bosses
– Difficult to control a project’s progress
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Democratic or Open structured teams
• A “grass roots” anti-elitist style of team organization
–
–
–
–
–
Egoless: group owns the documents & code (not individuals)
All decisions are based on team consensus
Depends on total cooperation of its members
Requires clear structure for the way the team interacts
Functional roles (e.g. moderator, recorder) rotate among team
members
– A technical leader has external responsibility and resolves issues
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when team doesn’t reach consensus
Why are democratic teams often favored
in Extreme Programming process?
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What kind of organization does this
cartoon illustrate?
• Do hierarchical organizations have to be like this?
• Why are hierarchical organizations the most common
in industry and government?
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