OB360 final

performance incentives

reward that ties pay to performance

types of performance incentives

profit sharing, employee stock ownership, piece-rate, merit-based raise, bonus, commission, fixed base pay

when does individual performance pay work best

worker output easily measured, workers can focus on measurable task, output not dependent on others

incentives of money

can undermine complex thinking

self determination theory

people prefer to feel they have control over their actions so anything that makes an enjoyed task feel like an obligation instead of a freely chosen activity will undermine intrinsic motivation

incentives can have unanticipated consequences

you get the behavior you reward, not the behavior you want

incentives can enhance perceptions of inequity

3rd problem of incentives

payback

greatest when trust is given

formal or informal contract increases trust, performance, and motivation

informal

smart goal

specific, measurable, agreed upon, reasonable, time bound

sender bias

illusion of transparency, sugarcoat negative infore

recipient bias

positive self illusions, self affirmation

fundamental attribution error

bias in how individuals view their contributions and contributions of others

egocentric bias

we overestimate our own contribution b/c of availability heuristic

self fulfilling prophecy

initial impressions tend to be confirmed and further enforced

performance feedback steps

prepare, communicate feedback, followup

feedback aspects

frequency, method, timing, target, topic

formal power

coercive, reward, legitimate

personal power

expert, referent

low power individuals

obey demands, influenced when persuaded

powerless individuals

treated more sympathetically and generously than those with little power

problems with power

overconfident, objectify others, less likely to take perspective of others

why does power decrease empathic concern

less perspective taking, less motivation to affiliate with others

how does power affect norms

less likely to follow norms

escape downside of power

cultivate humility and empathy

organizational culture

shared values and norms that define appropriate attitudes and behaviors of organization members

culture is strong when

set of norms and values that are widely share and strongly held

artifacts

what one sees, hears, feels

espoused values

sense of what out to be, rather than what is

basic underlying assumptions

unconscious, taken for granted beliefs, hard to change

where does culture come from

founders and early members

benefit of strong culture

high motivation, cohesion

costs of strong culture

unwillingness to question shared values, lack of diverse opinions and perspectives

exploration

creating new possibilities via experimentation

incremental vs divergent creativity

gradual improvement vs entirely new principles

creativity vs innovation

idea generation vs idea implementation

creative personality traits

tolerance of ambiguity, openness to experience

who should decide on idea success

creators were most accurate in predicting success

how to sell ideas

make the unfamiliar familiar (ex the Uber for x)

personality

stable ways of thinking, feeling, and acting that make a person unique

MBTI

extroversion/introversion, sensing/intuiting, thinking/feeling, judging/perceiving

pros of mbti

widely used, recognize individual differences

cons of mbti

little evidence, forces bi-modality (either/or)

Big 5 OCEAN

openness, conscientiousness, extraversion, agreeableness, neuroticism (emotional stability)

when is personality more likely to be linked to actual behavior

weak situation - low clarity of duties and weak norms

terminal values

desirable end states (happiness, social recognition, comfortable life)

instrumental values

preferable modes of conduct (self control, intellect, imagination)

individual vs collective culture

standing out vs cohesive group

limits of rational decision analysis model

bound by uncertainty and imperfection of the mind

decision process

encounter problem -> gather info -> analyze options -> assess decision

narrow framing

focus on trade offs, not creative solutions, miss hidden alternatives

solution to narrow framing

expand your options

confirmation bias

we seek out info that proves us right

solution to overconfidence bias

solicit disconfirming evidence

conformity pressure

we conform to opinions supported by majority or an authority figure

solution to conformity and anchoring

private data collection

anchoring

we make insufficient adjustments away from initial estimate, opinion, or idea

availability bias

info that is easier to recall is outweighed in decision process

loss aversion

losses loom larger than gains

solution to loss aversion

flip the frame ("what do we stand to lose")

overconfidence bias

more confident in things we're less familiar with

solution to overconfidence bias

get people close to the info to make decision

sunk cost fallacy

outcomes should match level of investment

escalation of commitment

investing more resources in hopes of overturning initial failure

solution to escalation of commitment

establish concrete criteria for success, use 3rd party enforcer

representativeness bias

when relying on representativeness, judge wrongly b/c the fact something is more representative does not actually make it more likely

nudges

choice that alters people's behavior in predictable ways without changing incentives

NUDGES

iNcentives, Understand mappings, Defaults, Give feedback, Expect error, Structure complex choices

trouble with mental time travel

sol: ask someone who has recently experienced what you want rather than imagining

hedonic adaptation

humans good at getting used to changes in our lives (positive and negative)

career search sequence

vision -> strategy -> tactics

meaningful career

fit between reqs of work role and individual's beliefs values and behaviors

job design

top down, designed by managers, one size fits all

job crafting

bottom up, crafted by employees, everyone is unique

job design + job crafting

actual job

procedural: framing and anchoring

gain vs loss, set starting value

procedural: voting strategies

choosing public/private voting

procedural: coalition building

learn others' views and levels of commitment to target the people on the fringe/undecided/indifferent

procedural: frame the message

happy audience thinks less critically, leverage availability bias

interpersonal: social proof

show similar people are doing what you are asking

interpersonal: reciprocity

people try to repay in kind what another has provided; give info and reject gifts

interpersonal: consistency

people are willing to say yes to a request that is more consistent with what they have already said or done, foot in the door

interpersonal: authority

people obey authorities in mindless fashion

milgram experiment

people stop resisting and give up control when responding to authority figure

interpersonal: liking

people prefer to comply with requests of people they know and like

interpersonal: scarcity

people value items more as they become less available

distributive negotionas

involved single issue, zero-sum structure

negotiation prep

want yours and others: target price, reservation price, BATNA

BATNA

best alternative to a negotiated agreement

first offer

use anchoring and offer rationale

response to first offer

never immediately accept, determine your offer before exposure to first offer

concessions

should be bi-lateral