Chapter 15 Organizational Behavior

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Chapter 15, Question 30, Page 449-452

Read the PDF first and explain "What are the advantages and disadvantages of group decision making?" Answers should have at least three paragraphs and 15 sentences. Use complete sentences, avoid unexplained lists, and avoid slang. Use a professional writing style at all times.

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CHAPTER 15 • DECISION MAKING AND ORGANIZATIONAL LEARNING 449 Group Decision Making Frequently groups, rather than individuals, make decisions in organizations. These groups might have a formal leader or functional manager who oversees the decision-making process. Selfmanaged work teams also need to make decisions, however. In this section, we consider some of the potential advantages, disadvantages, and consequences of group decision making. (See Exhibit 15.4.) Advantages of Group Decision Making There are several advantages of using groups to make decisions. These include the availability and diversity of members’ skills and expertise; enhanced memory for facts; greater ability to correct errors; and greater decision acceptance. AVAILABILITY AND DIVERSITY OF MEMBERS’ SKILLS AND KNOWLEDGE When groups make decisions, the skills and knowledge of each group member are pooled, and their joint expertise can be focused on a specific opportunity or problem. For certain kinds of decisions, an individual decision maker is very unlikely to have all the different capabilities needed to make a good decision. For example, when General Electric (GE) needed to decide whether to invest $70 million to modernize GE’s washing machine-manufacturing facilities near Louisville, Kentucky, or buy washing machines from another company and sell them under the GE brand name, a cross-functional team composed of managers from its different departments was formed to gain input about manufacturing costs, product development costs, and sales and issues. Union representatives were also involved because GE needed to know if union members would accept major changes to their jobs that would be required to cut costs if the company decided to go forward with the modernization program. After processing all this information, the group jointly agreed on their final recommendation—to go ahead with the modernization program, and this proved to be a wise decision.51 Whenever a decision requires the skills, knowledge, and expertise of different functional experts (such as marketing, finance, engineering, production, and R&D), group decision making has clear advantages over individual decision making. And IT, such as ERP Systems, today provide group members with a wealth of companywide information they can use to reach the best decision possible. To gain the information processing advantages of group decision, it is necessary that there is diversity among group members (see Chapter 10). In addition to diversity in functional knowledge and expertise, it is often desirable to have diversity in age, gender, race, and ethnic backgrounds. Diversity gives a group the opportunity to consider different points of view. Traditionally, for example, groups that designed new automobiles for major carmakers like GM and Ford were all male. Now, to develop popular world cars, these companies realize it is vital to have women on the team (women buy more cars than men today) and experts in sales and design from abroad who know the tastes of customers in other countries. They bring new, different, important cultural insights to the design process that result in a new car model that appeals to women and car buyers in other countries.52 Gap, the well-known clothing company, is another company that is responsive to the changing needs of its diverse customers, and it is careful to employ clothes designers and salespeople who reflect the demographics of its customers. Gap forms teams of diverse employees EXHIBIT 15.4 Group Decision Making Advantages and Disadvantages of Group Decision Making Advantages Availability and diversity Enhanced memory for facts Greater ability Disadvantages Greater decision acceptance Time to make a decision Potential for groupthink 450 PART 2 • GROUP AND TEAM PROCESSES to investigate customers’ changing needs to discover if it is meeting their needs, and if not, how its clothing should be redesigned to do so.53 Although diverse work groups can improve decision making, they can give rise to a problem: group members with different points of view because of their varied backgrounds sometimes find it hard to get along with each other. Many organizations are trying to respond to this challenge through diversity training programs, which aim to help members of an organization understand each other so they can work together effectively and make good decisions. ENHANCED MEMORY FOR FACTS When a decision requires the consideration of a substan- tial amount of information, groups have an advantage over individuals because of their memory for facts.54 Most people engaged in the process of making a decision have experienced the frustrating problem of forgetting an important piece of information. Because a group can rely on the memory of each of its members, the problem of forgetfulness is minimized. Information that one member of the group forgets is likely to be remembered by another. For example, by forming a cross-functional team of diverse managers, GE helped ensure that important information was not forgotten or overlooked when the decision about whether or not to embark on the modernization program was being made. CAPABILITY OF ERROR DETECTION No matter how experienced decision makers are, they all make mistakes. Some errors occur in the information-gathering stage or in the evaluation of alternatives. Other errors occur when the final decision is made. When a group makes a decision, errors made by some group members can be detected and corrected by others.55 If, for example, a manufacturing manager at GE overestimated the costs of retooling the new washing machine facility, it is likely that other group members would detect the error in the decision-making process. GREATER DECISION ACCEPTANCE For a decision to be implemented, it is necessary that the members of an organization accept the decision. Suppose, for example, a grocery store manager decides to extend the store’s operating hours from 18 to 24 hours a day by scheduling employees to work for longer periods of time (and not hiring any new employees). The employees must accept this decision for it to work. If none of the employees is willing to work the new 10 P.M. to 6 A.M. shift, the decision cannot be implemented. The likelihood employees will accept a decision increases when they take part in the decision-making process. GE’s decision to invest $70 million to modernize its washing machinemanufacturing facilities, for example, depended on union leaders agreeing to major changes in the employees’ jobs, such as cross-training, so they could perform different tasks as required.56 By involving the union in the decision-making process, GE helped ensure employees would accept and support changes in work relationships. Disadvantages of Group Decision Making Group decision making has certain advantages over individual decision making (particularly when the decisions are complex, require the gathering and processing of large amounts of information, and require the acceptance of other organizational members). But there are also disadvantages to group decision making. Two of them are time and the potential for groupthink. TIME NEEDED TO MAKE A DECISION Have you been in the annoying situation of being in a group that seemed to take forever to make a decision that you could have made yourself right away? One of the disadvantages of group decision making is the amount of time it consumes. Groups can seldom make decisions as quickly as individuals. Moreover, when the amount of time a group takes to make a decision is multiplied by the number of people in the group, the extent to which group decision making consumes valuable time and effort is apparent. Under certain conditions, individual decision making takes less time than group decision making and is likely to result in a decision that’s just as good. Organization’s should use individual and not group decision making when (1) an individual has the capabilities needed to make a good decision; (2) an individual is able to gather and accurately process all the necessary information; and (3) the acceptance of the decision by the organization’s other members is either not required or will likely happen, regardless of their involvement in decision making. Bruce Weaver\AP Wide World Photos CHAPTER 15 • DECISION MAKING AND ORGANIZATIONAL LEARNING 451 THE POTENTIAL FOR GROUPTHINK Groupthink is a pattern of faulty decision making that occurs in cohesive groups whose members strive to reach a common agreement or understanding, and to achieve this they do not accurately process important information relevant to the decision—and are even willing to gloss over or suppress information that might lead them to disagree.57 Irving Janis coined the term groupthink in 1972 to describe a paradox that he observed in group decision making: Sometimes groups of highly qualified and experienced individuals make very poor decisions.58 The decisions made by President Lyndon B. Johnson and his advisers between 1964 and 1967 to escalate the war in Vietnam, the decision made by President Richard M. Nixon and his advisers to cover up the Watergate break-in in 1972, the decision made by NASA and Morton Thiokol in 1986 to launch the Challenger space shuttle (which exploded after takeoff, killing Groupthink often occurs in crisis situations when decision makers all crew members)—all these decisions were influenced by grouplack accurate information about events and process information think. After the fact, the decision makers involved in these and according to the group’s preferred assumptions and values. Some other fiascoes are often shocked that they and their colleagues argue this occurred at NASA and resulted in the launch and were involved in such poor decision making. Janis’s investigations subsequent destruction of the Challenger space shuttle. of groupthink primarily focused on government decisions, but the potential for groupthink in business organizations is just as likely. For example, the joint decision of Mattel’s managers (see the opening case for this chapter) not to GROUPTHINK A pattern of faulty decision making change Barbie or bring out new, contemporary lines of dolls to protect current Barbie sales can that occurs in cohesive groups also be seen as an example of this decision-making error. whose members strive for agreeRecall from Chapter 11 that cohesive groups are very attractive to their members, and ment at the expense of accurately people value their group membership and strongly want to retain it. When groupthink occurs, assessing information relevant to members of a cohesive group are often willing to unanimously support a decision favored by the the decision. group leader without carefully assessing its pros and cons. This unanimous support is often based on members’ exaggerated beliefs about the group’s capabilities and moral standing. They think the group is more powerful than it is and could never make a decision that might be morally or ethically questioned. As a result, the group becomes closed-minded and fails to pay attention to information that suggests that the decision might not be a good one. Moreover, when members of the group do have doubts about the decision being made, they are likely to discount those doubts and not mention them to other group members. As a result, the group as a whole perceives that there is unanimous support for the decision and its members actively try to prevent negative information pertaining to the decision from being brought up for discussion.59 Exhibit 15.5 summarizes Janis’s basic model of the groupthink phenomenon. It is important to note that although groupthink occurs only in cohesive groups, many cohesive groups never succumb to this faulty mode of decision making. A group leader can take the following steps specifically designed to prevent the occurrence of groupthink; these steps also contribute to good decision making in groups in general:60 ● ● ● ● DEVIL’S ADVOCATE Someone who argues against a cause or position in order to determine its validity. ● The group leader encourages all group members to be critical of proposed alternatives, to raise any doubts they may have, and to accept criticism of their own ideas. It is especially important for a group leader to subject his or her own viewpoint to criticism by other group members. The group leader refrains from expressing his or her own opinion and views until the group has had a chance to consider all alternatives. A leader’s opinion given too early is likely to stifle the generation of alternatives and productive debate. The group leader encourages group members to gather information pertaining to a decision from people outside the group and to seek outsiders’ perspectives on the group’s ideas. Whenever a group meets, the group leader assigns one or two members to play the role of devil’s advocate—that is, to criticize, raise objections, and identify potential problems with any decisions the group reaches. The devil’s advocate should raise these problems even if he or she does not believe the points are valid. If an important decision is being made and time allows, after a group has made a decision, the group leader holds a second meeting. During the second meeting, members can raise any doubts or misgivings they might have about the course of action the group has chosen. 452 PART 2 • GROUP AND TEAM PROCESSES EXHIBIT 15.5 Groupthink Source: From Irvin L. Janis, Groupthink Psychological Studies of Policy Decisions and Fiascoes, 2nd ed. Copyright © 1982 Wadsworth, a part of Cengage Learning, Inc. Reproduced by permission. Symptoms of groupthink 1. Illusion of invulnerability Group members are very optimistic and take excessive risks. 2. Belief in inherent morality of the group Group members fail to consider the ethical consequences of decisions. 3. Collective rationalizations Group members ignore information that suggests they might need to rethink the wisdom of the decision. 4. Stereotypes of other groups Other groups with opposing views are viewed as being incompetent. 5. Self-censorship Group members fail to mention any doubts they have to the group. 6. Illusions of unanimity Group members mistakenly believe they are all in total agreement. 7. Direct pressure on dissenters Members who disagree with the group’s decision are urged to change their views. 8. Emergence of self-appointed mind guards Some group members try to shield the group from any information that suggests that they need to reconsider the wisdom of the decision. Defective decision-making process Bad decisions Other Consequences of Group Decision Making Three other consequences of group decision making are not easily classified as advantages or disadvantages: diffusion of responsibility, group polarization, and the potential for conflict. DIFFUSION OF RESPONSIBILITY Group decisions are characterized by a diffusion of respon- sibility61—that is, the group as a whole rather than any one individual is accountable for the decision. If the decision was a good one, the group gets the credit; if the decision was a poor one, a single individual is not blamed. Sometimes, when important decisions are made that entail considerable uncertainty, it can be very stressful for one individual to assume sole responsibility for the decision. Moreover, under these conditions, some people are inclined to make a decision they know will not come back to haunt them rather than the decision they think is best for the organization. When this is the case, diffusion of responsibility can be an advantage of group decision making. Diffusion of responsibility can also be a disadvantage if group members do not take the time and effort needed to make a good decision because they are not held individually accountable. This consequence is related to the concept of social loafing (see Chapter 11), the tendency for individuals to exert less effort when they work in a group. GROUP POLARIZATION Another consequence of group decision making is that groups tend to make more extreme decisions than do individuals. This tendency is called group polarization.62 By extreme decisions, we mean making more risky or conservative decisions rather than taking a middle-of-the-road approach. At one extreme, for example, the group might decide to commit a vast amount of resources to develop a new product that may or may not be successful. At the other extreme, it might decide not to introduce any new products because of the cost and uncertainty involved. Why are decisions made by groups more extreme than decisions made by individuals? The diffusion of responsibility is one reason.63 But there are at least two more explanations for group polarization. First, knowing that other group members have the same views or support the same decision can cause group members to become more confident of their positions.64 Group members who initially supported committing a moderate amount of resources to the development of a new product may become more confident in the product’s potential success after learning that other members of the group also feel good about the product. As a result of this increased confidence, the group makes the more extreme decision to commit a large amount of resources. Second, as a group discusses alternatives, members of the group often come up with persuasive arguments to
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