8 Decision Making and Creativity McGraw-Hill/Irwin © 2008 The McGraw-Hill Companies, Inc All rights reserved Decision Making at Radical Ron Sangha/ BC Business Radical Entertainment founder Ian Wilkinson (third from right) meets with employees every week to reinforce the electronic games developer’s emphasis on creative decision making and employee involvement McShane/Von Glinow OB4e Slide 8-2 © 2008 The McGraw-Hill Companies, Inc All rights reserved Decision Making Defined Ron Sangha/ BC Business Decision making is a conscious process of making choices among one or more alternatives with the intention of moving toward some desired state of affairs McShane/Von Glinow OB4e Slide 8-3 © 2008 The McGraw-Hill Companies, Inc All rights reserved Rational Choice Decision Process McShane/Von Glinow OB4e Slide 8-4 © 2008 The McGraw-Hill Companies, Inc All rights reserved Problem Identification Process • Problems and opportunities are not announced or pre-defined – need to interpret ambiguous information • Problem identification uses both logical analysis and unconscious emotional reaction during perceptual process – need to pay attention to both logic and emotional reaction in problem identification McShane/Von Glinow OB4e Slide 8-5 © 2008 The McGraw-Hill Companies, Inc All rights reserved Famous Missed Opportunities The top-rated television commercial in history the Apple Macintosh “Why 1984 won’t be like 1984” almost wasn’t aired because every outside director on Apple’s board despised it The ad violated the mental models that they held of what a good ad should look like Apple Computer Inc Used with permission McShane/Von Glinow OB4e Slide 8-6 © 2008 The McGraw-Hill Companies, Inc All rights reserved Problem Identification Challenges Stakeholder framing Perceptual defense Mental models Decisive leadership Solution-focused problems Apple Computer Inc Used with permission McShane/Von Glinow OB4e Slide 8-7 © 2008 The McGraw-Hill Companies, Inc All rights reserved Identifying Problems Effectively • Be aware of perceptual and diagnostic limitations • Understand mental models • Discussing the situation with colleagues see different perspectives Apple Computer Inc Used with permission McShane/Von Glinow OB4e Slide 8-8 © 2008 The McGraw-Hill Companies, Inc All rights reserved Making Choices: Rational vs OB Views Goals Rational: Clear, compatible, agreed upon OB: Ambiguous, conflicting, lack agreement Processing Information Rational: People can process all information OB: People process only limited information Evaluation Timing Rational: Choices evaluated simultaneously OB: Choices evaluated sequentially more McShane/Von Glinow OB4e Slide 8-9 © 2008 The McGraw-Hill Companies, Inc All rights reserved Making Choices: Rational vs OB (con’t) Standards Rational: Evaluate against absolute standards OB: Evaluate against implicit favorite Info Quality Rational: People rely on factual information OB: Rely on perceptually distorted information Decision Objective Rational: Maximization the optimal choice OB: Satisficing a “good enough” choice McShane/Von Glinow OB4e Slide 8-10 © 2008 The McGraw-Hill Companies, Inc All rights reserved Employee Involvement Model Potential Involvement Outcomes • Better problem identification Employee Involvement • More/better solutions generated Contingencies of Involvement McShane/Von Glinow OB4e Slide 8-18 • Best choice more likely • Higher decision commitment © 2008 The McGraw-Hill Companies, Inc All rights reserved Contingencies of Involvement Higher employee involvement is better when: Decision Structure Knowledge Source Decision Commitment Risk of Conflict McShane/Von Glinow OB4e • Problem is new & complex (i.e nonprogrammed decision) • Employees have relevant knowledge beyond leader • Employees would lack commitment unless involved • Norms support firms goals Employee agreement likely Slide 8-19 â 2008 The McGraw-Hill Companies, Inc All rights reserved Creative Process Model Verification Insight Incubation Preparation McShane/Von Glinow OB4e Slide 8-20 © 2008 The McGraw-Hill Companies, Inc All rights reserved Characteristics of Creative People • Above average intelligence • Persistence • Relevant knowledge and experience • Inventive thinking style McShane/Von Glinow OB4e Slide 8-21 © 2008 The McGraw-Hill Companies, Inc All rights reserved Creative Work Environments • Learning orientation – Encourage experimentation – Tolerate mistakes • Intrinsically motivating work – Task significance, autonomy, feedback • Open communication and sufficient resources • Team competition and time pressure have complex effect on creativity McShane/Von Glinow OB4e Slide 8-22 © 2008 The McGraw-Hill Companies, Inc All rights reserved Creative Activities Redefine the Problem Associative Play CrossPollination • Review abandoned projects • Storytelling • Diverse teams • Artistic activities • Explore issue with other people • Morphological analysis • Information sessions McShane/Von Glinow OB4e Slide 8-23 Internal tradeshows â 2008 The McGraw-Hill Companies, Inc All rights reserved Decision Making and Creativity McGraw-Hill/Irwin © 2008 The McGraw-Hill Companies, Inc All rights reserved Solutions to Creativity Brainbusters McGraw-Hill/Irwin © 2008 The McGraw-Hill Companies, Inc All rights reserved Double Circle Problem McShane/Von Glinow OB4e Slide 8-26 © 2008 The McGraw-Hill Companies, Inc All rights reserved Nine Dot Problem McShane/Von Glinow OB4e Slide 8-27 © 2008 The McGraw-Hill Companies, Inc All rights reserved Nine Dot Problem Revisited McShane/Von Glinow OB4e Slide 8-28 © 2008 The McGraw-Hill Companies, Inc All rights reserved Word Search FCIRVEEALTETITVEERS McShane/Von Glinow OB4e Slide 8-29 © 2008 The McGraw-Hill Companies, Inc All rights reserved Burning Ropes After first rope burned i.e 30 One Hour to Burn Completely McShane/Von Glinow OB4e Slide 8-30 © 2008 The McGraw-Hill Companies, Inc All rights reserved Chapter Extras McGraw-Hill/Irwin © 2008 The McGraw-Hill Companies, Inc All rights reserved Levels of Employee Involvement High • High involvement – Employees have complete decision making power (e.g SDWTs) • Full consultation Medium – Employees offer recommendations (e.g gain sharing) • Selective consultation Low McShane/Von Glinow OB4e – Employees give information, but don’t know the problem Slide 8-32 © 2008 The McGraw-Hill Companies, Inc All rights reserved