questions 12
A study published in the British Medical Journal (January 20
1
2) sought to determine whether exercise would help extend the lives of patients who have had non fatal heart attacks. A sample of 800 patients with heart failure was recruited; 390 received exercise training and 410 did not. There were 78 deaths among the exercise group and 114 among those who did not exercise. Can researchers infer at the 5% significance level that exercise training reduces the death rate of persons who have previously suffered heart attacks? Solve manually (show all work) and by Mega Stat only. Indicate your hypotheses, decision rule, statistical decision and management conclusion using the critical value and then find the p-value and state your decision rule, statistical decision and management conclusion using this method.
1
BBUS 300: ORGANIZATIONAL BEHAVIOR, ETHICS & INCLUSIVITY
FINAL EXAM CONTENT OVERVIEW (FALL 2020)
Final Exam Format
33
DURATION: 120 mins
Total: 100 points
§ MCQ: 4
5
points – 18 questions; 2.5 points each
§ Short: 35 points – Number of questions and points per question will vary
§ Long: 20 points – 1 question only
No need to upload note sheet or study guide.
Content Covered:
All topics from S13 (Negotiations) to S18 (Org Culture) will be on the exam.
Please see the ‘Final Exam Overview’ to see which specific slides will be covered
in the exam. You can find it under Modules > Session 21 > Final Exam
If you have DRS accommodations, please email me to set-up a time for your
exam.
NEGOTIATIONS
The process through which two or more parties settle
their differences and work toward an agreement.
The 4 step process of Negotiation:
1) Preparatio
n
2) Exchanging Information
3) Bargaining
4) Closing and
Commitment
Negotiation
Resolving conflict
5
1) Preparation
6
Do your homework:
What is your…
1) Target Point = Best outcome you can realistically hope to achieve?
2) BATNA = Your Best Alternative To a Negotiated Agreement?
3) Resistance Point = Point at which you walk away? (determined by BATNA)
What do you predict is their…
1)Target Point = Best outcome they can realistically hope to achieve?
2) BATNA = Their Best Alternative to a Negotiated Agreement?
3) Resistance Point = Point at which they walk away?
Use this info to Develop a strategy
2) Exchange Information
7
BATNA & Resistance point do not change
during a negotiation (without new info)!
§ Never reveal your resistance point
§ Be cautious about revealing your
BATNA
Reveal your target point quickly!
§ Use a point, not a range
§ Use research to back it up
Present info supporting your position
Bargaining Zon
e
3) Bargaining
8
$60,000 $80,00
0
Recruiter’s Aspiration Range
Resistance point
(BATNA)
Resistance point
(BATNA)
Candidate’s Aspiration Range
Target
point
Target
point
§ Discuss additional issues
§ Make concessions and give up something to get something in return
4) Closing & Commitment
9
NOT IMPORTANT FOR EXAM
§ Formalizing the agreement reached in the previous stage.
§ Learn from the process
§ Approaches that work
ed
§ Areas of improvement
§ “What would it have taken for us to reach an
agreement?”
DISTRIBUTIVE INTEGRATIVE
Available
Resources
Fixed amount to be
divided
Variable amount to be
divided
Primary
motivations
Win-Lose
(zero-sum condition)
Win-Win
Primary interests Opposed to each other Convergent/congruent
with each other
Relationship-
focus
Short term Long term
Example Salary Bonus, insurance
Approaches to Negotiation
10
Approaches to Negotiation
Distributive Negotiations
Winning the Largest Share
11
Strategies for Success:
i. Making the first offer
ii. Making concessions
i) MAKING THE FIRST OFFER
Person who makes first offer in a distributive negotiation usually does
better due to Anchoring: First offers account for more than 50% of
variance in final outcomes. High anchors direct toward positive attributes
and more room for concessions.
ii) MAKING CONCESSIONS
Capitalize on the norm of reciprocity by making token concessions that ar
e easy for you to give.
§ Keep track of concessions
§ Start with larger concessions
§ Make your concessions smaller as you approach your goal to signal to
the other party that you are reaching your limit
Distributive Negotiations
Goal: Winning the Largest Share
13
Strategies that work Strategies that don’t work
§ Sharing information about
preferences and priorities
§ Ask diagnostic questions of
other party
§ Unbundle items
§ Log Rolling: Concede on less
important things in exchange
for concessions on your more
valued issues
§ Secrecy
§ Stalling: Taking extra time to
negotiate
§ Try to compromise on every item
§ Split the Difference: Trying to
always meet in the middle.
Integrative Negotiations
Goal: Creating Value
PERCEPTION & DECISION MAKING
Decision Making
The process of generating and choosing
from a set of alternatives to solve a
problem
System 1 (Programmed Decisions)
§ Automatic, fast, emotional, stereotypical,
unconscious.
§ Good for quick decisions & crisis situations
§ More susceptible to biases
System 2 (Non-programmed Decisions)
§ Slow, effortful, infrequent, logical,
calculating, conscious
§ Good for major decisions with high costs
significant consequences
System 2 (Non-programmed Decisions)
Rational Decision-making Model
Problem clarity: Problem is clear and unambiguous
Known options: All relevant criteria and viable
alternatives are identifiable
Clear preferences: The criteria and alternatives can
be ranked and weighted
Constant preferences: Specific decision criteria are
stable over time
No time or cost constraints: Any alternative is
possible
Maximum payoff: One alternative will yield the
highest perceived value
16
Define the
problem
Identify and rank
the criteria
Develop/
Identify
alternatives
Evaluate the
alternatives
Select best
alternative
Faulty
Assumptions
which are Limitations of each stageStages
Implement best
alternative
So we….
• Satisfice: Identify and settle on solutions that are “good enough”
• Skipping steps in the rational decision-making model
• Not examining all possible alternatives thoroughly
Using…
• Heuristics: Simple, efficient rules of thumb/cognitive short-cuts to make
decisions
• Are often adaptive
• Can lead to correct decisions
• But are subject to biases
There are limitations on our ability to collect, interpret, process, and
act on information….
Bounded Rationality Model
Decision making Traps
18
GROUP LEVEL ISSUES
§ Biases
§
Decision making issues
Poor Decisions
INDIVIDUAL LEVEL BIASES
Faulty Perceptions
§ Selective perception
§ Framing
Faulty Attributions
§ Fundamental attribution error
§ Stereotyping
Escalation of Commitment
Faulty Perceptions: Distortions in incoming information
1. Selective perception
§ Confirmation Bias
§ Availability bias
2. Framing
§ Anchoring Bias
§ Negativity Bias
INDIVIDUAL LEVEL BIASES
Faulty Perceptions
Faulty Perceptions: Distortions in incoming information
1. Selective perception:
§ Confirmation Bias
§ Availability bias
2. Framing
§ Anchoring Bias
§ Negativity Bias
INDIVIDUAL LEVEL BIASES
Faulty Perceptions
The tendency for people to only
see information that is consistent
with their existing beliefs and
expectations.
“Seeing what we want to see”
Faulty Perceptions: Distortions in incoming information
1. Selective perception:
§ Confirmation Bias
§ Availability bias
2. Framing
§ Anchoring Bias
§ Negativity Bias
INDIVIDUAL LEVEL BIASES
Faulty Perceptions
The tendency to look for information
that confirms our existing beliefs and
expectations….
even when information that would
disconfirm them would be more
helpful.
Faulty Perceptions: Distortions in incoming information
1. Selective perception:
§ Confirmation Bias
§ Availability bias
2. Framing
§ Anchoring Bias
§ Negativity Bias
INDIVIDUAL LEVEL BIASES
Faulty Perceptions
The tendency to base judgements on
information easier to recall
§ Vivid and highly emotional events
§ Unusual things (Bizarreness effect)
§ Things I think about often (Frequency)
§ The first thing I see (Primacy effect)
§ The last thing I saw (Recency effect)
§ Based on a reference in proximity
(Contrast effect)
Faulty Perceptions: Distortions in incoming information
1. Selective perception:
§ Confirmation Bias
§ Availability bias
2. Framing
§ Anchoring Bias
§ Negativity Bias
INDIVIDUAL LEVEL BIASES
Faulty Perceptions
The tendency to make a different
decision based on how the question is
phrased
Faulty Perceptions: Distortions in incoming information
1. Selective perception:
§ Confirmation Bias
§ Availability bias
2. Framing
§ Anchoring Bias
§ Negativity Bias
INDIVIDUAL LEVEL BIASES
Faulty Perceptions
The tendency to rely too heavily, or
“anchor” on one piece of information
when making decisions, even when the
anchor might be unreliable or irrelevant.
Faulty Perceptions: Distortions in incoming information
1. Selective perception:
§ Confirmation Bias
§ Availability bias
2. Framing
§ Anchoring Bias
§ Negativity Bias
INDIVIDUAL LEVEL BIASES
Faulty Perceptions
Loss aversion/’Bad is stronger than good’
The tendency to focus more on
avoiding losses to acquiring equivalent
gains.
Decision making Traps
26
GROUP LEVEL ISSUES
Biases
Decision making issues
Poor Decisions
INDIVIDUAL LEVEL BIASES
Faulty Perceptions
§ Selective perception
§ Framing
Faulty Attributions
§ Fundamental attribution error
§ Stereotyping
Escalation of Commitment
27
INDIVIDUAL LEVEL BIASES
Faulty Attributions
Faulty Attributions
Systematic errors made when people evaluate or try to find
reasons for their own and others’ behaviors.
1. Fundamental attribution error and Self-serving bias
2. Stereotyping (*also a form of Faulty Perceptions)Fundamental attribution error
When explaining someone else’ behavior, we
§ underestimate the influence of external factors
§ overestimate the influence of internal or personal factors
Self-serving bias
When explaining our own behavior, we
§ attribute success on internal or personal factors
§ blame failure on external factors
INDIVIDUAL LEVEL BIASES
Faulty Attributions
Faulty Attributions
Systematic errors made when people evaluate or try to find
reasons for their own and others’ behaviors.
1. Fundamental attribution error and Self-serving bias
2. Stereotyping (*also a form of Faulty Perceptions)
Judging an individual on the basis of one’s perception of
the group they belong to.
29
INDIVIDUAL LEVEL BIASES
Escalation of Commitment
The decision to continue on a failing course of action.
Caused by…
1. Sunk cost fallacy:
• Further investment is warranted, otherwise resources
already invested will be lost.
• Not taking into consideration the overall losses involved in
the further investment.
2. Preference for completion: Inherent bias towards completing
tasks
3. Personal Identification
Status and identity tied to commitments à withdrawing from
commitment may result in loss of status or threat to identity.
Critical Decisions are usually Ambiguous and Rarely Easy
§ Biases can be used against you to manipulate you
§ Biases can be used to influence others’ decisions
How to Reduce Biases in your Decision Making
§Extend your search for information
§Look for information that disconfirms your beliefs
§Don’t create meaning out of random events
30
Takeaways
Group Decision Making
31
We look to
others to provide
relevant
information
about
ambiguous
situations.
…and we
conform to peer
pressure.
Group Errors in Decision-Making
§ Groupthink
§ Information Silos
§ Group Level Biases
§ Pluralistic Ignorance
§ Common Knowledge Problem
32
Group Errors in Decision-making
Group Errors in Decision-Making
Groupthink
Phenomenon in which group pressures for
conformity prevent the group from critically
appraising unusual, minority or unpopular views
Common Causes
§ Peer pressure
§ Silencing of minority opinions
§ Dominant vocal leader
§ Sense of isolation
§ Illusion of invulnerability
§ Limited time & resources to discuss all perspectives
33
Group Errors in Decision-making
Irving Janis
34
Information silos
Unshared information among members/groups.
No or very little information is shared
This effect is amplified at Inter-group level
Group Errors in Decision-making
Example: Fixing group decision making issues
1. Each participant should function as a “skeptical
generalist,” focusing on the problem as a whole rather
than approaching it from his or her department’s
standpoint.
2. The team should sometimes meet without Kennedy
(leader) present, so as to avoid people simply following his
views
3. The team should be broken into sub-groups that would
work on alternatives and then reconvene.
4. To stimulate freewheeling discussions, the group should
use informal settings, with no formal agenda and protocol,
so as to avoid the status-laden meetings.
Group Errors in Decision-making
Pluralistic Ignorance: Groups may
agree to a course of action that no
individual member prefers because
they each assume other group
members prefer that course of action.
Common Knowledge Problem:
Groups spend the majority of time
discussing information that they all
have in common.
Unique information is rarely shared
and, if it is shared, it is often not
widely discussed. 36
We’re here
coz everyone
else wanted
to watch this
movie.
GROUP LEVEL BIASES
Criteria of Effectiveness Groups Individuals
Accuracy
Speed
Creativity
Quality
Efficiency
TRUST, JUSTICE & ETHICS
TRUST
39
The willingness to be vulnerable based on positive expectations
about the actions and intentions of another party.
WHO DO YOU TRUST? WHY?
40
WHO DO YOU TRUST? WHY?
41
WHO DO YOU TRUST? WHY?
STUDY MATERIALS
Disposition-based trust means that your personality traits include a general propensity to trust others
Trust propensity —a general expectation that the words, promises, and statements of individuals and
groups can be relied upon.
Affect-based trust means that it depends on feelings toward the authority that go beyond any
rational assessment. We trust because we have feelings for the trustee; we like them or have a
fondness for them. Those feelings are what prompt us to accept vulnerability.
Cognition-based trust means that trust is rooted in a rational assessment of the authority’s
trustworthiness.
§ Ability: skills, competencies, and areas of expertise that enable an authority to be successful in
some specific area.
§ Benevolence – belief that the authority wants to do good for employees, are concerned about
their well-being, and feel a sense of loyalty to them.
§ Integrity – perception that the authority adheres to a set of values and principles that the trustor
finds acceptable; they are of sound character—they have good intentions and strong moral
discipline. Integrity also conveys an alignment between words and deeds—a sense that authorities
keep their promises, “walk the talk,” and “do what they say they will do.
Motivated Attribution Trust: Based on dependence on the trustee by perceiving them as trustworthy.
People ameliorate the anxiety associated with dependence by developing trust towards trustee.
Types of Trust Over Time: Early stage
42
Your personality attribute (Trust propensity)
Underlies a general expectation that the
words, promises, and statements of others
can be relied upon
43
Their Reputation underlies a rational assessment of
authority’s trustworthiness
§ Ability: Are they competent?
§ Benevolence: Do they have my best interest at
heart?
§ Integrity: Are they consistent?
Types of Trust Over Time: Middle stage
44
Your Bond — depend on feelings
toward the authority that go beyond
rational assessment
Types of Trust Over Time: Late stage
45
Motivated Attributions Based Trust
Can occur any time based on how dependent you are on the authority
Weber, Malhotra & Murningham, 2004
Types of Trust Over Time: All stages
47
Trust in Businesses
REFLECTION QUESTION:
Do you trust companies with your personal data?
Why or why not? Justify your response using specific forms if trust that
determine your decisions.
Justice
OUTCOME based
• Did I receive what I expected to, and in
comparison to others?
Distributive
PROCESS based
• Was I involved in the process?
• Was the process implemented consistently?
Procedural
TREATMENT based
• Was I treated in a respectful and
appropriate manner?
Interpersonal
COMMUNICATIONS based
• Did I receive justifications for decisions, and
do I believe them?
Informational
The reward
you receive
Performance
Evaluation
Criteria
How your
boss treats
you
How well they
communicate
The perceived fairness of an authority’s action
Ethics
The study of moral values or principles that guide our behavior and
inform us whether actions are right or wrong
Research on ethics seeks to explain
§ What individuals consider right and wrong
§ When and why people behave morally/immorally
Ethics
The 4-Component Model
50
1) Moral Awareness:
a) Moral Attentiveness (Self)
b) Moral Intensity (Situation)
Does an ethical situation exist?
2) Moral Judgement:
a) Kohlberg’s 6 Stages
b) Ethical perspectives
What is the right thing to do?
3) Moral Intent Are you committed to act
ethically?
4) Ethical (or unethical) Behavior
Extent to which an individual chronically perceives and considers morality and
moral elements in different situations
This is an individual attribute. Some individuals are more prone to see situations as
ethical.
This could be based on culture or personality
51
Step 1: Moral Awareness
a) Moral Attentiveness
Certain aspects of the issue make it more likely to be seen as ethical.
FOR FINAL EXAM:
You should know the two general dimensions.
You don’t need to know specific facets.
52
Step 1: Moral Awareness
b) Moral Intensity
Step 2: Moral Judgement
53
Up to Age 9 Adolescents Adults <20% Adults
So
I
do
n’
t
ge
t
in
tr
ou
bl
e
So
I
ge
t
so
m
et
hi
ng
So
y
ou
lik
e
m
e
It
’s
t
he
r
ig
ht
th
in
g
to
d
o
So
y
ou
lik
e
m
e It
’s
t
he
la
w
W
e
ag
re
ed
NOT IMPORTANT FOR FOR FINAL EXAM
What is the right thing to do?
Ethical
Perspectives
Sub-categories
(Type of Principle)
Description
Teleological
(telos – goal or
end)
Egoism/
Objectivism
An act is morally right if the serves the decision maker’s
self-interest.
Utilitarianism An act is morally right if it results in the greatest good
for the greatest number of people
Deontological
(deon – duty)
Ethics of Duties
An act is morally right if it: a) does not harm society, b)
respects human dignity, and c) is endorsable by others.
Ethics of Rights
An act is morally right if it respects the natural rights of
others (e.g. life, liberty, justice, the pursuit of
happiness).
Virtue ethics
An act is morally right if it allows the decision maker to
lead a good life
54
Step 2: Moral Judgement
Moral Intent
55
Once a person has made a moral judgment, he or she
must decide whether to follow it i.e. whether to act
ethically/ “do the right thing”.
Predictors of moral intent include:
• Proximity & social consensus
• Perceived sense of control
• Emotionally aroused state
• Organizational pressures
Step 3: Moral Intent
The 4-Component Model
56
1) Moral Awareness:
a) Moral Attentiveness (Self)
b) Moral Intensity (Situation)
Does an ethical situation exist?
2) Moral Judgement:
a) Kohlberg’s 6 Stages
b) Ethical perspectives
What is the right thing to do?
3) Moral Intent Are you committed to act
ethically?
4) Ethical (or unethical) Behavior
Virtue Ethics vs. Egoism in Business
Egoism Virtue Ethics
Goal
The responsibility of a business
encompasses the interests of
their shareholders.
Maximize profit
Minimize cost
The responsibility of a business is to be
socially accountable to itself, broader set
of stakeholders, and the public.
Maximize positive impact
Minimize harmful impact
Employee Treated as a Resource Treated as a Partner
Scope
Taught in business schools,
widely accepted.
Frequently a self-fulfilling
prophesy
Taught in only a few business schools, BUT
interest is on the rise (e.g. driven by
generational, social, environmental
trends)
Virtue Ethics on the rise
58
THIS PART IS NOT IMP FOR EXAM
Virtuous companies…
§ Experience increased profitability, productivity, customer retention, and employee
loyalty in times of change
§ Have an advantage in attracting and motivating talent
§ Report lower employee stress, presenteeism and absenteeism as well as fewer
counterproductive work
behaviors
THE FOLLOWING REASONS ARE IMPORTANT FOR EXAM
Reasons:
1) Amplifying effect: virtuousness is contagious
2) Buffering effect: virtuousness is protective
Links with other topics
Motivation theories useful for understanding why employees
behave unethically.
• Reinforcement theory: People demonstrate higher unethical
behaviors if their unethical behaviors are followed by rewards
or go unpunished.
• Expectancy theory: If people believe that their unethical
actions will be rewarded with desirable outcomes, they are
more likely to demonstrate unethical behaviors
59
TEAMS & Teamwork
Teams
THIS SLIDE IS NOT IMP FOR EXAM
A collection of individuals …
• who are interdependent in their tasks
• who interdependent in their common goals and outcomes
• who see themselves and who are seen by others as an intact
social entity
6
1
Why Teams?….
• Teams tend to innovate faster
• See mistakes more quickly
• Find better solutions to problems
• People working in teams report higher job
satisfaction
How Teams Evolve: The 5 Stage Model
6
2
Group members learn about each other and the task at hand
Unwillingness to accommodate others’ ideas triggers conflict
Create norms & expectations, shared goals, cooperate
Groups reach a conclusion, become comfortable
in their roles, implement solution
Disband and disengage
Limits of the Five-Stage Model
§ Does not consider length of stages
§ Teams do not necessarily progress through the stages one at a time
§ Order of stages may vary in different organizations
§ Teams can sometimes go back to an earlier stage
§ Teams can skip a stage
§ Some teams never get beyond forming or storming
63
The 5 Stage Model: Limitations
Time
(Low)
(High)
First
Meeting
Phase 1
Phase 2
Tr
an
sit
io
n
Completion
A B(A+B)/2
Pe
rf
or
m
an
ce
How Teams Evolve:
The Punctuated-Equilibrium Model
64
Periods of rapid change:
§ First meeting
§ Transition
§ Completion
Periods of inertia (stability):
§ Phase 1
§ Phase 2
Time
(Low)
(High)
First
Meeting
Phase 1
Phase 2
Tr
an
sit
io
n
Completion
A B(A+B)/2
Pe
rf
or
m
an
ce
How Teams Evolve:
The Punctuated-Equilibrium Model
65
§ First meeting: Period of rapid change sets the group’s direction
§ Phase 1 of group activity has inertia
How Teams Evolve:
The Punctuated-Equilibrium Model
66
§ A transition takes place exactly when the group has used up half of its allotted
time
§ The transition initiates major changes
Time
(Low)
(High)
First
Meeting
Phase 1
Phase 2
Tr
an
sit
io
n
Completion
A B(A+B)/2
Pe
rf
or
m
an
ce
How Teams Evolve:
The Punctuated-Equilibrium Model
67
§ Phase 2 of inertia follows the transition
§ Completion Stage is characterized by a final marked acceleration in activities
Time
(Low)
(High)
First
Meeting
Phase 1
Phase 2
Tr
an
sit
io
n
Completion
A B(A+B)/2
Pe
rf
or
m
an
ce
How Teams Evolve:
The Punctuated-Equilibrium Model
68
Reflection question:
§ Which model do your BBUS300 group project teams follow?
§ Which stage are you at right now?
Time
(Low)
(High)
First
Meeting
Phase 1
Phase 2
Tr
an
sit
io
n
Completion
A B(A+B)/2
Pe
rf
or
m
an
ce
§ Team Size
§ Diversity
§ Task Interdependence
§ Types of Tasks
§ Cohesion & Performance Norms
§ Psychological Safety
Factors Affecting Team Process & Performance
69
• Smaller groups are faster at
completing tasks
• Smaller teams have lower
coordination requirements
(“coordination costs”)
• Larger teams allow for greater
knowledge pooling
• Larger groups are better at solving
complex problems
Factors Affecting Team Processes & Performance
Size
Advantages
§ Multiple perspectives
§ Increased creativity
§ Increased flexibility
§ Superior problem-solving
Factors Affecting Team Processes
Diversity
Disadvantages
§ Fault lines
§ Miscommunication
§ Difficulty in reaching
consensus
§ Slower to act
71
Factors Affecting Team Processes & Performance
Diversity
Surface-level diversity
Based on observable attributes such as race, ethnicity, sex, and age.
• May have negative impact (conflict, poor communication) at early stages
• Negative effects tend to disappear as members become more knowledgeable
about one another
Deep-level diversity
Based on attributes that are less easy to observe initially but can be inferred
after more direct experience. Differences in attitudes, values, and personality.
• Negative effects (e.g.: conflict, poor communication) can increase with time (as
underlying values and goals become increasingly apparent).
• Managing Deep-level diversity:
• Reflecting on shared goals
• Leaders emphasize the task, roles, and expectations
72
Factors Affecting Team Processes & Performance
Diversity Types
Factors Affecting Team Processes & Performance
Task Interdependence
73
+ Number of interdependent ties is moderately correlated with performance
+ Number of interdependent ties is highly correlated with commitment
Comprehensive Interdependence Reciprocal Interdependence
Sequential InterdependencePooled Interdependence
Which type represents your project group and why?
Disjunctive tasks
Single problem for the group to solve. Team
performance driven by most competent person in
the group.
Conjunctive tasks
The team’s performance depends on the abilities of
the “weakest link”.
Additive tasks
Contributions resulting from the abilities of every
member “add up” to determine team performance.
74
Factors Affecting Team Processes & Performance
Types of Tasks
Which task represents your group project and why?
75
Factors Affecting Team Processes & Performance
Outcome Interdependence
–
0.3
–
0.2
–
0.1
0
0.1
0.2
0.3
Speed/Quantity Accuracy/Quality
Individual
compensation
Team-based
compensation
§ Separate rewards promote speed/quantity
§ Pooled rewards promote accuracy and
quality
Pooled Rewards
Separate Rewards
Hybrid outcome
interdependence
76
Cohesion: Degree to which group members are attracted to each other and
are motivated to stay (think group commitment)
Performance Norms: Rules that the team agrees to follow as it conducts its
work.
Cohesion
Low
High
Pe
rf
or
m
an
ce
N
or
m
s
High Low
High Team
Performance
Moderate Team
Performance
Low Team
Performance
Low Team
Performance
Factors Affecting Team Processes & Performance
Cohesion & Performance Norms
77
Psychological safety
A ‘shared belief held by members of a team that the team is safe for
interpersonal risk-taking.
A sense of confidence that the team will not embarrass, reject or
punish someone for speaking up.
Factors Affecting Team Processes & Performance
Psychological safety
Teams: Pros & Cons
PROS:
Process Gains
Cons: Process Losses
78
Process Gains
Getting more from the team than you would expect according to the
capabilities of its individual members
• Combine useful resources and capabilities
• Increase motivation due to heightened engagement
• Group commitment and group identification enhance performance
79
80
Process Losses
Actual
Productivity
Potential
Productivity
Process
Losses
Process losses: Processes that hinder a team from achieving its
full potential.
Getting less from the team than you would expect based on the
capabilities of its individual members.
Three main types:
§ Motivation Losses
§ Ability Losses
§ Coordination Losses
§ Social Loafing: When team members free ride or exert less effort when
working on team tasks than they would if they worked alone on those
same tasks.
81
Process Losses
Motivation Loss
REASONS
Diffusion of responsibility:
§ Feel less personally accountable for a task,
§ Feel that their individual efforts have little impact on overall
outcome
“My own effort will have little effect on the outcome”
Expectations
§ Don’t want to get stuck doing all of the work.
“Others aren’t pulling their weight, so why should I?”
§ Let over-achievers handle all the work.
“I don’t have much to contribute over what the other
members have already contributed.
Ability Loss: The presence of others can lead to
performance decrements.
Social inhibition/Choking
Contributing Factors:
• Distraction
• Performance Anxiety
82
Process Losses
Ability Loss
83
Coordination Losses: Extra effort focused on integrating work
consumes time and energy that could otherwise be devoted to task
activity.
1. Production Blocking: Waiting on others to finish their work before you
can do your own.
2. Segmentation: Focusing on dividing labor at the expense of the end
product.
• Disjointed final products (E.g.: final project reports)
• Inability to recognize synergies
3. Conceptual blocking: The inability to listen and think at the same time.
• Miscommunication
• Missed opportunities
83
Process Losses
Coordination Loss
Process Loss Symptoms Structural
Fixes
Leadership
Fixes
Coordination
Losses
Production blocking
Conceptual
blocking
Segmentation
Clear communication
channels
Clear division of labor
Have a task coordinator
Ensure all members
understand goal and
process
Ability
Losses
Distraction
Anxiety
Formal training system Provide opportunities to
practice
Manage performance
anxiety
Motivation
Losses
Social Loafing Optimized rewards
systems
Raise accountability
Match member tasks to
interests
Increase group cohesion
Increase task
interdependence
84
Process Losses
Troubleshooting Summary
Team error > average of individual errors Dominant Voices /groupthink
Team error = average of individual errors Untapped Ability
Team error < average of individual errors Synergy (Gestalt)
Don Keough & Roberto Goizueta (CEO)
Process Losses
Member Impact on Process Losses
0
5
10
15
20
Member A Member B Member C Member D Member E AVERAGE TEAM
Er
ro
r
0
5
10
15
Member A Member B Member C Member D Member E AVERAGE TEAM
Er
ro
r
0
5
10
15
20
Member A Member B Member C Member D Member E AVERAGE TEAM
Er
ro
r
Not important for exam
Is your team suffering from Process Losses??? L
Do you have Dominant Voices who derail group performance?
Is there too much groupthink!!
Do you want to utilize Untapped Ability?
Then use the wisdom of BBUS 300 Consultants and Thinkers!
§ Encourage questions…
“He who asks a foolish question is only a fool for a moment, but he who never asks a
question remains a fool for life.” – Lucas Edgar Bolles (SEC B)
§ Always send a follow-up email to all attendees, summarizing the meeting and then add in
anything you didn’t get to state; Invite others to add anything too. – Lindsey A Scully (SEC B)
Other ideas:
ü Appoint a “devil’s advocate” tasked with constructively critiquing team’s decision making
ü Collect opinions independently: Gather opinions individually before people share their
thoughts within the wider group.
ü Provide a safe space for all members to speak up without fear of retribution
For more see: 7 Strategies for Better Group Decision-Making (HBR, 2020)
https://hbr.org/2020/09/7-strategies-for-better-group-decision-making
BBUS 300 Wisdom: How to address Process Losses
POWER & LEADERSHIP
Bases of power
Organizational power: Derived primarily
from a person’s position within the
organization.
1.
Legitimate
2. Reward
3. Coercive
Personal power: Personal attributes and
skills that enable people to influence
others.
4. Referent
5. Expert
POWER is the capacity to influence
the behavior of others in accordance
with one’s wishes.
Organizational power
1. Legitimate Power
Legitimate Power: Based on a position of authority in the organization or
social system.
‘A’ has the right, considering his/her position, to expect B to comply with
requests
Organizational power
2. Reward
Power
Reward Power: Based on control over the resources or rewards another
person wants
‘A’ is able to give rewards to B, and B finds it beneficial to trade favors
with A
Organizational power
3. Coercive Power
Coercive Power: Based on control over punishments in an organization.
Power based on fear; ‘A’ can hurt, or make things difficult for ‘B’
Personal power
4. Expert Power
Expert Power: Based on a person’s expertise, skill,
knowledge, or the ability to solve problems on
which others depend.
‘A’ has expertise to obtain B’s respect so B defers to
A’s judgment
Personal power
5. Referent Power
93
Referent Power: Based on others’ desire to
identify and be associated with a person.
Driven by affection, admiration, or loyalty.
‘B’ likes ‘A’ and enjoys doing what they ask
Coercive
Power
Reward
Legitimate
Referent
Expert
Most likely employee response
Resistance Compliance Commitment/Internalization
Pe
rs
on
al
O
rg
an
iz
at
io
n
94
5 Bases of Power
Leadership
The use of power and influence to direct the
activities of followers towards goal achievement.
Are Leaders Born or Made?
• Research with 119 pairs of
identical twins and 94 pairs of
fraternal twins
• Examined the role of genetic
influences and different
personality variables in
predicting leadership role
occupancy.
Behavior
70%
Traits
30%
Leadership as a Trait
97
Leadership based on physical and psychological attributes of people.
§ There is one right way to be a leader
§ Leaders are born, not made
§ Traits associated with leadership
Leader emergence – who becomes a leader in the first place
Leader effectiveness – how well people actually do in a leadership role
NOT IMPORTANT FOR EXAM
What do effective leaders do?
q There are many ways to be a leader
q Leaders are not born, they are made by their actions
q Leaders engage in behaviors and adapt to their followers
98
Leadership as Behavior
Three broad types:
1. Laissez-Faire Style
2. Transactional
3. Transformational
99
Leadership as Behavior
Laissez-Faire
• Leader abdicates responsibilities
• Offers little guidance
• Avoids making decisions
100 https://sites.google.com/site/leadershipstylesinteams/leadership-style
Transactional Leadership
Ensure that employees demonstrate the right behaviors and provide
resources to them in exchange.
Management by exception (passive): Intervenes only if standards are not
met; punishes indiscretions
Management by exception (active): Watches and searches for deviations
from rules and standards; takes corrective action proactively
Contingent reward: Exchanges rewards for effort, promises rewards for
good performance, recognizes accomplishments.
Transformational Leaders motivate through social
identification and empowerment.
Four behaviors of Transformational Leaders (4-I’s):
§ Individualized Consideration
§ Intellectual Stimulation
§ Inspirational Motivation
§ Idealized Influence
102
Transformational Leadership
Individualized Consideration
§ Gives respect & personal attention; treats each employee
individually
§ Coaches, advises, develops and mentors based on person’s
specific needs.
103
Zappos now requires managers to spend 10
to 20 percent of their time horsing around
with employees. “It’s just kind of a random
number we made up,” Hsieh tells the mag.
“But part of the way you build company
culture is hanging out outside of the office.”
Tony Hsieh
Transformational Leadership
1. Individualized Consideration
Transformational Leadership Behaviors
“We do not need more people gambling in
nonessential instruments identified with the
stock market in this country, nor brokers who
encourage them to do so … We need the
intelligent commitment of investment capital,
not leveraged market wagers.”
-Warren Buffett
104
Intellectual Stimulation
• Challenges
• Promotes intelligent reasoning
• Encourages rationality, creativity and careful problem solving.
Transformational Leadership
2. Intellectual Stimulation
Transformational Leadership Behaviors
Inspirational Motivation
• Provides a vision for the future
• Communicates high expectations
• Uses symbols to focus efforts
• Expresses important purposes in simple ways.
105
Transformational Leadership
3. Inspirational Motivation
Transformational Leadership Behaviors
Idealized Influence
§ Instills pride
§ Gains respect and trust through charisma.
1
0
6
106
Transformational Leadership
4. Idealized Influence
“He doesn’t know anything is impossible because,
well he’s always been able to do anything he wanted.
So even as he’s being a jerk, he’s got this incredibly
seductive aura around him that keeps you bound to him,
keep you near his flame, keeps you on the team”
–Apple employee about Steve Jobs
Ethical leadership
Demonstration of normatively appropriate conduct through personal actions and
interpersonal relationships.
§ Ethical role-modelling behavior for follower
§ Communicate and justify their actions to followers
§ Set and follow ethical standards
§ Reward ethical conduct, punish unethical behavior
§ Consider ethical implications in decisions-making
REFLECTION QUESTION:
Who do you think is a modern day example of an Ethical Leader?
Justify your response
107
ORGANIZATIONAL STRUCTURE
ORGANIZATIONAL CULTURE
How jobs and tasks are divided and coordinated between
individuals and groups within an organization
Organizational Chart
109
FlatPyramidal
Organizational structure
Elements of Organizational Structure
1. Centralization –
Degree of decision-making concentration
2. Formalization – Degree to which explicit rules, policies, job
descriptions, etc. are used to regulate and standardize employee
behaviors
3. Span of Control – How many individuals report to a manager
4. Work Specialization – Degree to which tasks in an organization are
divided into separate jobs.
5. Chain of Command – Clarity of reporting structures
High Centralization: Decisions are concentrated
at a few points at the higher levels of the
organization
Low Centralization (decentralization): Decisions
are distributed or pushed to broader levels
111
Degree of decision-making concentration
Elements of Organizational Structure
1. Centralization
High formalization: Employees have little
discretion.
Many specific rules and procedures
standardize behaviors and decisions.
Low formalization: Employees have more
freedom and discretion
Fewer rules and procedures
112
To what degree are explicit rules, policies, job descriptions, etc. used
to regulate and standardize employee behaviors?
Elements of Organizational Structure
2. Formalization
113
How many individuals report to a manager?
Elements of Organizational Structure
3. Span of Control
Narrow span means leaders have closer control
over few employees.
+ Allows managers close control.
– Expensive – more managers per employee
– Discourages employee autonomy.
Wide span means leaders have more distal
control over many employees.
Larger span:
+ Greater employee autonomy & empowerment
+ Cuts costs and overheads
– Greater role ambiguity for employees
– Requires more employee training.
Degree to which tasks in an organization are divided into separate jobs.
§ Related to skill variety from JCT
High specialization means employees do
fewer tasks repetitively
Benefits of high Specialization:
• Higher efficiency and productivity
Easier to train employees
Downsides of high Specialization:
• Boredom and stress
• Low motivation
• High turnover, increased absenteeism
Low specialization means employees do
several unique tasks 114
Elements of Organizational Structure
4. Work Specialization
To whom do individuals and groups report.
Who has authority to direct others
Simple chain of command: Top-down flow of
authority with clear reporting structure
Complex chain on command: Unclear reporting
structure with either no managers or multiple
managers (example Matrix organizations)
115
Elements of Organizational Structure
5. Chain of Command
Combining Elements of Organizational Structure
116
ORGANIC ORGANIZATIONS
Low Specialization
Low Centralization
Low Formalization
Weak chains of command
Wide spans of control
High Flexibility & Adaptiveness
Low Efficiency
Thrive in dynamic environments
MECHANISTIC ORGANIZATIONS
High Specialization
High Centralization
High Formalization
Rigid & hierarchical Chain of command
Narrow Spans of control
Low Flexibility
High Efficiency
Thrive in stable environments.
What kind of organization is UW? Why – Justify using elements of
Org Structure?
Factors influencing Org Structure
§ External environment
§ Business Strategy
118
Business Strategy: Objectives and goals of an organization and how it
tries to capitalize on its assets to make money.
1) Innovation:
Emphasizes the introduction of new products and services
2) Differentiation:
Focus on developing and providing unique products/services
3) Cost minimization:
Emphasizes price cutting, tight cost controls, and avoidance of unnecessary
research or marketing expenses.
Factors influencing Org Structure: Business Strategy
REFLECTION QUESTION:
Mechanistic Structure versus Organic Structure?
119
External Environment: Factors outside the organization and the uncertainty
associated with them.
Economic, social & political trends, technology, competitors, suppliers,
distributors, etc.
§ Stable environments: Do not change over time; Less uncertainty
Ø Organizations may focus on increasing efficiency in areas of strength.
Ø In contrast, it maybe be safer to explore new avenues
§ Dynamic environments: Frequent Change; More uncertainty
Ø Organizations focus on being more adaptive
Ø *In contrasts, in extremely dynamic environments, orgs may focus on
doing what they know rather than experimenting/exploring.
REFLECTION QUESTION:
Mechanistic Structure versus Organic Structure?
Factors influencing Org Structure: External Environment
Organizational
Culture
“Culture is the soul of the organization… I think of the
structure as the skeleton, and as the flesh and blood. And
culture is the soul that holds the thing together and gives it
life force.”
~Henry Mintzberg
120
Culture: The pattern of shared values, beliefs, and
assumptions considered to be the appropriate way to
think and act within an organization.
Assumptions
Beliefs
How do we identify culture?
121
Symbols
Physical Structures
Language
Stories
Rituals & Ceremonies
Artifacts of Culture
Manifestations of an organization’s culture that
can be easily seen.
Primary means of transmitting an organization’s
culture.
Organizational
Culture
Values
Stable and shared principles, standards, and goals about what is
important.
Often visible through mission statements, articulated vision, etc.
Example: A strong commitment to preserving the environment.
122
“Good health can’t wait.“
Articulating the purpose has
empowered employees to take
risks and try new things.
Values
“Our businesses are guided by our values and by
our Småland legacy to make the best possible use
of the limited resources available… For us there is
no contradiction between profitability and
responsibility.”
The understanding of how objects, ideas and outcomes, relate to
each other
Relates to cause and effect
Example:
Belief in the idea that employee recognition will lead to enhanced
performance and commitment
“Google believes that centralizing its
workforce and designing its offices to
encourage random encounters between
employees from different areas of the
company increases the chances for
serendipitous encounters and
discussions.”
123
Beliefs
Assumptions
The taken-for-granted notions of how something should be done
in an organization
Ingrained such that employees simply act on them rather than
questioning their validity in a given situation
Relates to Norms
Example: The norm that employees obey a chain of command.
Our distinct corporate culture is one
of the things that set us apart from
other firms. We expect everyone at
the firm to be a contributor; no one
is just an employee.”
124
Assumptions
125
Artifacts: Physical Structures
The physical structure and layout of the workplace
§ Is the workplace open?
§ Does top management work in a separate section of the building?
§ Can employees express their personalities?
126
Artifacts: Physical Symbols
Corporate logo, images on website, type of clothes/uniforms its
employees wear.
127
Starbucks employees are called ‘Partners’
Ingvar Kamprad and the first letters of the
farm, Elmtaryd and the village Agunnaryd
Artifacts: Language
Jargon, slang, and slogans used within an organization.
128
The founder poured rubber into a waffle
maker to make a better shoe sole
o A customer wanted to return snow tires and get his
money back.
o The clerk saw the price on the side of the tires, reached
into the cash register and handed the man $145
o It did not matter that Nordstrom’s did not sell tires and
never sold tires
Artifacts: Stories
Anecdotes, accounts, legends, and myths that are passed down from
cohort to cohort within an organization.
The Haka – the Maori war
dance that the New
Zealand rugby team does
before the start of every
match.
Etsy has a ritual of informal
communal lunches twice-
weekly with food provided by
local vendors.
Artifacts: Rituals & Ceremonies
Planned routines that occur in an organization, within a unit (rituals)
or with an audience (ceremonies)
§ Some rituals emphasize org goals. E.g.: 3-minute meetings at UPS
§ Some rituals are mere superstitions, with little bearing on
performance, but can add value by boosting confidence and team
cohesion.
Dimensions of Culture
Culture varies on two primary dimensions
§ Culture strength: Degree to which employees definitively agree about the way things are
supposed to happen within the organization
+ Strong cultures unite and direct employees
– Strong cultures take a long time to develop; Very difficult to change.
§ Nature of Culture: Positive (E.g.: collaboration) versus Toxic (e.g.: cutthroat competition)
130
Positive
Toxic
Weak Strong
A
B C
D
REFLECTION QUESTION
Think of an organization that has a Strong culture (not examples discussed in class)
Is this culture Positive or Toxic?
Provide specific examples to demonstrate why you think the culture is Positive or Toxic
(This could be anecdotes, new reports, etc. about specific practices or elements of culture of this
organization)
131
Founders Selection
Top
Management
Socialization
Culture
Creating & Perpetuating Culture
§ Selection: Founders hire
employees who think and feel
like they do
§ Imprinting: Founders
indoctrinate employees in their
way of thinking
§ Role-modeling: Founders act as
cultural role models
132
Founders Influence on Culture
Top Management Teams (TMT)
• TMT establish and
communicate norms.
• Structure organizational
reward systems to
implement leaders’ visions
133
TMT Influence on Culture
Employees Influence on Culture
ASA Model
• Attraction: Employees seek
organizations that match their
characteristics and values.
• Selection: Organizations recruit and
hire employees that match their
culture.
• Attrition: Misfits are more likely to
leave or make errors and be let go.
Through ASA, corporate cultures become
more homogeneous
134
135
Anticipatory: Period of learning culture prior to joining the organization.
Encounter: Employees see what the organization is really like and confront
potential gaps in expectations.
Metamorphosis: Employees adjusts to culture of the work.
Anticipatory
Stage
Encounter
Stage
Metamorphosis
Stage
In-role Performance
Commitment
Citizenship behavior
Socialization Process Outcomes
Employees Influence on Culture
Socialization
136
As Employees: Join & support the right organizations (as much as possible)
As Employers:
§ Hire the right people through selection
§ Emphasize and inculcate the right values through socialization
§ Don’t hesitate to let go of the bad apples
As TMT members: Create reward systems to encourage the right behaviors
As Leaders: Role-model the right behaviors
Creating & Perpetuating a Strong & Positive Culture
Reflection Question
What is UW’s culture?
137
Think about any element of culture
that you think represents UW’s
culture.
Clearly identify the type of element
this is – value, ritual, language, etc.
What does it say about
UW’s culture?