Learning Objectives

After studying this chapter, you should be able to do the following:

5.1: Illustrate common perceptual biases with examples.
5.2: Explain how self-fulfilling prophecies affect job performance.
5.3: Provide two examples of how decision making affects organizational performance.
5.4: Explain the rational decision-making model and bounded rationality.
5.5: Demonstrate understanding of prospect theory and the impact of framing on decisions with an example.
5.6: Describe the role of intuition in decision making.
5.7: List and explain major decision traps and how to avoid them: hindsight, hubris, and escalation of commitment.
5.8: Discuss the elements in Amabile’s three-component model of creativity.