group behaviour decision process organisation and business management mba oum

ORGANISATION AND BUSINESS MANAGEMENT BMOM5203

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TABLE OF CONTENTS

1. INTRODUCTION ......................................................................................................................... 2

2. BACKGROUND OF THE PROBLEM ...................................................................................... 4

3. GROUP BEHAVIOUR DECISION PROCESS ........................................................................ 5

4. DECISION MAKING - EFFECTIVENESS EVALUATION .................................................. 9

5. DISCUSSION ON ANY EXISTING PROBLEM .................................................................... 12

6. SUGGESTION FOR IMPROVEMENT .................................................................................. 15

6.1 Brainstorming ........................................................................................................................... 15

6.2 Delphi Technique ...................................................................................................................... 15

6.3 The Nominal Group Technique (NGT) ................................................................................... 15

6.4 Group Decision Support Systems (GDSS) .............................................................................. 16

7. CONCLUSION ........................................................................................................................... 17

8. REFERENCES ............................................................................................................................ 18


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GROUP DECISION MAKING

1. INTRODUCTION

In today’s working environment many decisions in organisations are made by teams, groups,

or committees. There are many benefits of group decision making comprise of: extra

knowledge and expertise is obtainable to resolve the problem; a bigger number of alternatives

are studied; the final decision is better understood and accepted by all group members; and

there is more obligation among all group members to make the final decision work. There are

some common dysfunctions of effective group decision making. There are few ways in which

the organization can tackle these dysfunctions and improve group decision making. They

include devil’s advocate, dialectic, brainstorming and other method.

Decision making is the process by which managers respond to opportunities and threats by

analyzing the options and making determinations, or decisions, about specific organizational

goals and courses of action (Contemporary Management, 2016).

Figure 1.0

Decision making is usually defined as the act of making up your mind about something.

However, the process of decision making is not as easy as it sounds. There are certain important

decisions that you have to make which can change the course of your life. Even at a workplace,

one is confronted with problems or dilemmas, where the solutions should cater to the need of

others around you.


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Such decisions have to be made in a careful way, especially if it is going to affect you

monetarily, or if it is going to bring major changes in your life. Thus, it is important to take

decisions in a systematic way, so that the decision you make has high chances of being

successful. The article here discusses the 6 stages in decision making that can help in clarifying

certain things in your mind before you take the final decision. These steps will also help

enhance your decision-making skills for different types of decision making.


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2. BACKGROUND OF THE PROBLEM

This study introduces the broader context of an overview of decision making in cross cultural

Mergers & Acquisitions (M&A). The purpose is followed by the problem area and research

question which will lead through the findings. Companies are equipped to make better

decisions if they are more sensitive to cultural differences in a cross-cultural environment.

Effective decision-making can enable smoother work place relationship within and across the

border M&A, if managers are attuned to cross-culture management.

Contextually, how organizations make decisions in a cross-cultural acquisition do is a critical

research question in the study of administrative process. Researchers have paid little attention

to complexities of decision making, in cross-cultural M&A. Previous research is more

concentrated on routine operational decisions that are more available to quantitative analysis

and particular descriptions.

Additionally other important research questions, especially related to thinking or cognition are

prevailing in the dynamic research of decision making, such as; how individuals get benefit

from cultural diversity learning, and how do individuals think and make different decisions.

These emerging notions defined our research questions of this thesis. Consequently, we have

formulated our research problem in the following questions:

1. What are the cross-cultural difficulties affecting decision-making in the acquired firm?

2. How does these cross-cultural difficulties influence the decision-making of acquired firm?

The study is only concerned with the decision-making process in a cross-cultural acquisition

and there is a less emphasis is on the cognitive factors of decision-making but the influence of

cross-cultural implications on decision-making behaviour in general. Due to time constraint,

one case company is used for this analysis consequently the results limit to this 'Company A'

only. Moreover, the Company A has agreed to co-operate with an anonymous status of itself

and its employees. This also set boundaries to the scope of our analysis. Further, this research

has been conducted on a local Malaysia company that has acquired an Australian based

company, so analysis and conclusions will be restricted to information obtained locally.

Problem may be an opportunity that needs to be exploited: a gap between what the organization

is doing now and what it can do to create more positive future (Management Leading &

Collaborating in a Competitive World, 2016).


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3. GROUP BEHAVIOUR DECISION PROCESS

Determining the 'why' and 'how' of decision-making in a cross cultural context of an acquired

firm can be done by finding the first-hand experiences of employees in Company A. To serve

the purpose of our study we chose interviews as the primary source of data collection. We felt

that person-to-person interaction with semi structured questions will be best in acquiring

information. Moreover, considering the characteristics of our investigation and that all the

employees could be reached within a close proximity and in a single premise, the 'interview

schedule' was chosen instead of a 'questionnaire'. Since culture can be a sensitive topic and the

interviewees could be reluctant in answering, we ensured anonymity at the start of the interview

process to make them comfortable. Through primary data we know the reasons behind a certain

management decision. Most appropriate way of learning about opinions and behaviour that are

relative to culture is by asking questions directly to people involved. Bauer et al. (2016)

indicated that Value creation in acquisitions is a complex topic with divergent theoretical roots

and mixed empirical evidence.

The approach is to use a qualitative research methodology of investigation, data collection and

analysis. Decision-making is not a fixed and static state to measure and it's a cognitive process,

besides it is not a 'steady state phenomenon' and changes erratically with time and environment.

Quantitative research emphasizes on the quantification of data collection and analysis and

observe social world as an external and objective reality. Bearing this in mind and our focus of

discovering and understanding the role of cross-cultural factors in decision-making, we were

convinced to use this method. Consequently the choice of our research method, is qualitative

and the purpose of the research inquiry is behavioural and therefore interconnected and

provides a basis for quantitative analysis.

Qualitative Study, our approach is purely qualitative. Qualitative research involves analyzing

and interpreting texts and interviews among others, in order to investigate specific patterns, i.e.

examining decision-making amidst cross-cultural challenges in an acquisition.

Interviewing is the most widely utilized method in qualitative approach of investigation and

this instrument suits appropriately to find answers to our research questions, .i.e. decision-

making under the implications of a cross-cultural acquisition.


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The technique and construction is very important in the formulation of interviews. The

interviews can be unstructured, semi-structured or structured. We chose to settle on semi-

structured interviews. We were very particular in formulating the questions as two cover both

aspects of cross-cultural implications and decision-making. On request by the contact person

at Company A, we got interview questions reviewed for improvement before presenting it.

Sampling. The choice of subjects that were needed to be investigated for our research questions

was crucial. Researcher should decide sample size in both quantitative and qualitative studies.

In the sample from Company A, we were looking for all the people cooperating with Australian

counterpart and are making some forms of decisions. It was kind of our contact person at the

company, after explaining our research necessity, five people have been arranged from

managers to engineers who were in some way cooperating with their counterpart.

Data Collection, as the query design directed us on the empirical data. The empirical data was

collected through semi-structured interviews using open ended questions. This permitted us to

probe relevant issues which emerged during the interview. We aimed at making the data

reliable, to ensure this we recorded the interviews upon permission and also took notes to

reduce the chance of misinterpretation. In an attempt to motivate the respondents to co-operate

with us and obtain factual data with their trust we ensured the anonymity and confidentiality

of responses. A reliable and credible data is vital for an authentic research. Throughout our

study we took measures to ensure this. During the interviews we did not rely on perceptions

which affects the accuracy of our observations and used constant probing to have clear answers.

We remained unprejudiced and flexible to have reliable working data. Data collection and

management is the information collected by researchers during a study and the steps for

monitoring and managing the data (Steen M., 2014).

Australian in an organization generally work in groups and are independent individuals at the

same time. They also have a freedom to express views, owing to a less hierarchical system.

Mutual agreement, consensus, structure and logical reasoning is very important to them for

which they have a lot of meetings and discussions. Australian are solution-oriented and are

usually calm.

There is a great difference in the decision-making process. In Australia everyone should agree

and ask a lot of people of what everyone think. Then decision will be made after hearing all


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the opinions. And it is opposite in Malaysia, you do not ask the employees if you are working

as a manager. I think you are seen as a weak leader if you ask people of what they think. It’s

positive and negative in both ways I think Australian way is better for working in a team and

but in Malaysia you really make the decision and you come forward.

Malaysian on the other hand don't have much freedom of expression due to a hierarchical

system in the acquired firm view. Another common view observed was that Managers in

Malaysia alone make decisions and value of consensus is less there. Australian are social and

build relationships. A lot more emotion is involved than facts in their reasoning.

The decision-making process depends on the type of decision. If it's a higher stake decision,

the process is followed through formal procedures of contracts and agreements compared to

daily operational level decisions which are simple. In Malaysia unit agreement has to be

reached through consensus whereas in Australian unit, managers give a decision which is to be

followed.

Cooperation at the technical or the lower level works well. At the management level

cooperation is difficult where decision making takes longer. Some employees expressed that

even with electronic facilities available communication is difficult. Employees cooperating for

a longer period developed relationships of trust which helps in cooperation amidst the cross-

cultural differences. On a practical point, the interaction between units is informal. But it

depends on the type of decision as well, i.e. starting a project, would follow a formal procedure

of interaction. Project managers have a closer contact compared to the rest. Informal day to day

technical decisions are handled on a daily basis. It is also hard to predict a response to an

interaction from across the border, some interviewees responded.

Through data it was also understood that is easier to agree on factual information, which all

can straightforwardly agree to. Language barrier has seem to affect the agreeability due to

misinterpretations sometime. The technical side of the decisions are easier to agree on,

compared to the decisions made at management level i.e. commercial issues. The tactical

decisions have been observed to have most complications whereas operational decisions are

easier.

Additionally, we comprehended from suggestions put forward by the respondents that, early in

the process of post-acquisition integration, communication on the differences in national and


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company culture can facilitate decision-making. Understanding of adapting to a culture is

important. Performance indicators and clarity on who makes which decisions will also assist.

On top of that diversity courses and communication on how to work together has helped in the

past and can also facilitate later on.


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4. DECISION MAKING - EFFECTIVENESS EVALUATION

Figure 2.0

An effective group decision making should encompasses items as per stated in above model,

Figure 2.0. This is to ensure decision made will give the right result with less negative impact.

The decision making dynamics, which decision makers assess in order to improve their

decision making effectiveness and evaluate alternative solutions to a problem, are: contingency

considerations, decision making styles and problem of escalation of commitment.

Contingency considerations refer to the 3 different strategies that can be used when selecting a

solution: a) Aided-analytic in which a decision maker uses specific and sometimes scientific

tools in order to reach a solution, b) Unaided analytic in which a decision maker choose a

solution based on information available and does not research for any new and c) Non analytic

in which decision makers use specific rules in order to reach a decision.

Choosing a strategy depends on two variables:

a) The characteristics of the decision task and

b) The characteristics of the decision maker.

The characteristics of the decision task depend on the characteristics of problem that is handled

such as unfamiliarity, ambiguity, complexity, instability and also the characteristics of the

environment in which the decision will take place such as irreversibility, significance, and


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accountability and time-money constraints. Normally the harder and more challenging the

constraints that a problem requires or the more unstable the environment, the more likely that

an aided analytic will be used and so help the decision maker to reach quality decision to a

problem. However it can be argued that time or costs available may prevent the decision maker

from using aided-analytic whatever the nature of the problem or environment since the costs

involved using aided approach may outweigh the benefits of the quality decision.

Moreover, if time pressure exists then decision maker may use the other two types which may

provide quicker solutions. In addition the characteristics of the decision maker have to be

assessed. Less skilled or motivated decision makers may not be able to use aided analytic due

to its scientific nature. Therefore all must be taken into consideration before deciding which

approach to use. A decision making style indicates the relationship of how an individual

identifies and responds to information and depends on two dimensions:

a) Value orientation which indicates the value that decision makers place on decisions, whether

social - people or task -technical concern and b) Tolerance for ambiguity which indicates

whether the decision maker need control or structure in his/her life.

These relationships -combinations of the two dimensions give rise to four (4) styles of decision

making: a) Directive, b) Analytical, c) Conceptual and d) Behavioural. Decision makers that

have directive style tend to be efficient, practical, and autocratic with task -technical concern

and low tolerance for ambiguity. Those that have analytical style are careful, need a lot of time

to reach a decision by overanalysing it and therefore they have high tolerance for ambiguity

and are task-technical oriented. Decision makers with conceptual style takes more risks, are

creative, idealistic and able to find many alternative to solutions and so are social-people

concern and have high tolerance for ambiguity.

Decision makers with behavioural style are sociable people who can build up relationships and

cooperate with other people. Therefore are social-people concerns and have low tolerance for

ambiguity. It is possible to suggest that based on researches made, decision makers may have

more than one decision making style and this may depend on the country situated, the job level

and job.

Knowledge of the different styles of decision making is important since it helps you realize

your abilities for improvement, influence others and be aware of how other decision makers do


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decisions. The final issue of decision making dynamics is the one of the escalation of

commitment which can be found in both individual and group decision making. It is more than

a psychological issue since decision makers keeps favour decisions or plans despite that are

proved to be not so successful or even a failure.

In organizations, decision-making is unavoidable and important. Once the decision-maker

makes the wrong decision, the impact is enormous and critical. Thus, decision-makers are

advised to think thoroughly before deciding on a certain issue. Before going further into

decision-making, it is important to understand the basic definition of decision-making.

Decision-making is defined as the cognitive process of reaching a decision. Decision making,

thus, is a process that involves stages before coming to a decision.

However, differences in the socialization of managers and the business situations that they face

may influence the decision-making process and choices that they make. By knowing an

individual's decision style pattern, it can be predicted how the individual reacts to various

situations. They argue that every individual has certain observable patterns of decision-making.


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5. DISCUSSION ON ANY EXISTING PROBLEM

Unfortunately a lot of merger and acquisitions fail to achieve their hoped objectives. Solutions

are of course complex. M&A are different along a number of dimensions. Companies fail to

realize a blind spot, by keeping their focus mainly on costs, they minimize or defer until too

late the human and cultural dimensions of blending two entities into unified growth-oriented

business. In any case organization is generally a collection of people sharing a common vision,

one or more location and resources such as money, equipment, and similar processes. Still

much of the business management persists in believing that the latter is the most important

issue, while people are only sort of the less important side of the scenario.

Clearly there is an urgent need to realize, rationalize, restructure and eliminated duplication the

first weeks and months of post-merger integration. Nonetheless rationalization only escalates

of the new organization making it a greater value to its shareholders. It is one thing to design a

new structure and relationship on paper and quite another to bring them to life. No matter how

visionary and driven the leaders are the financier, quickly learns that the synergy cannot be

generated merely from above or realize and reacting by reducing headcount or vice versa.

Synergy requires the commitment and involvement of the entire organizations. That is the most

challenging part.

Most mergers are seen of confusion, panic, uncertainty, distraction, limitation and

dehumanization. The process is painful and the results are costly. When knowledge capital is

vanished due to the turnover of key individuals during an M&A, when pride in the company

and pride in one's work is not appreciated through ill treatment at the hands of merger

managers, when innovations are abandoned in favour of outdated practices just because one

group is considered the "boss" and the new one reasoned expendable, the network that make

the organization work break down and fall apart. When employees stop caring, they lose

interest and motivation in improving the business processes. If they are not asked for their

opinions, they have no means or enthusiasm to inform the new system designers the unrevealed

secrets of success. When selection processes do not seem to be reasonable and rational,

dynamic management does not step into position they take on new challenges elsewhere. These

are not the circumstances which synergistic growth is likely.

Fortunately, the situation can be turned around. The M&A can become an opportunity for

people to learn, grow and have a voice. Shared visioning activities and cross company M&A


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project teams can provide opportunities to meet new people and gain new perspectives and

skills.

The problem with the acquired organization is that the managers must rearrange strategy,

organizational structure, work on staffing of employees, make changes to systems and culture,

all on top of the day to day business performances. They feel the pressure to quickly perform

and harmonize the decisions by reaching the performance in the changed worked environment.

So they do this by restructuring to create economies of scale, streamlining operations, focusing

on product and market synergies while eliminating noncore businesses. During the same time

they might be looking for the next merger or acquisition opportunity. This does not allow them

the time and effort to ensure a synergistic and sustainable basis of people and operations to

support the growth.

However for continued growth, building a foundation is the key to sustainable success because

it defines how the work of creating the new organization will be continued. Regrettably most

post M&A implementation plans seems to assume that if the financial priorities are

comprehensively addressed the human foundation will take care of itself. The synergy created

by a successful M&A.

After the discussion above, it can be suggested that despite the problems associated with group

decision making, still it is the most effective way to reach correct decisions in terms of quality

and commitment. This is because problems associated with group decision making can be

overcome as discussed previously and so the benefits outweigh the drawbacks and make groups

the most appropriate decision making style.

Cultural expectations and values are represented in the individual's mind. These values lie in

the individuals immediately when they are born. They are raised to understand that they have

expectations to be met before they leave the world. Values, in a way, become the guiding

principle on what they should do about their lives. This also applies on decision-making styles.

The values can explain why certain people prefer a particular decision-making style over

others. It is also because the success of their decision-making depends on what is appropriate

and expected in their cultural environments.


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People with collectivist values pay much more attention to the social aspects of problems. They

perceive a problem based on the judgment if the problem concerns about themselves or the

people around them. People with Individualistic values, on the other hand, put more attention

to the individual aspects of problems. They will react faster if the problems deal with

themselves.


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6. SUGGESTION FOR IMPROVEMENT

In large and complex organizations most of the basic and strategic decisions are made by group

of managers rather than individuals. It seems safe to say that in many instances group decision

making in preferable than individual decision making. Decisions relating to the determination

of organization goals, formulation of plans, strategies, and policies fall under this category.

Group decision making has become more wide prevalent during the past few decades because

organizational problems have become so complex which requires a variety of specialized and

abilities that no one person can handle effectively. Following are some recent techniques for

improving decision making:

6.1 Brainstorming

In many situations, groups are expected to produce creative or imaginative solutions to

organizational problems. In such instances brainstorming has often been found to enhance the

creative output of the group. Brainstorming is a useful technique for generating ideas about

possible causes of problems, and about potential solutions to problems, once they have been

identified. The objectives of brainstorming is to generate lots of ideas on a particular subject.

6.2 Delphi Technique

The Delphi technique is a systematic means to obtain consensus from a group or panel of

experts. The panel does not meet as a committee to discuss, or debate. In this technique

participants are asked to give their ideas, suggestions, and views on the decisional problem. All

responses are transcribed into a single document. Then the results are sent back to the panel

members and again their reactions to others views, ideas, and suggestions are collected. The

names of the participants are kept anonymous. It helps to evoke each participant’s unbiased

opinion by preventing the influences of group dynamics. A panel coordinator contacts each

participant usually by a mail questionnaire. Balasubramaniam et al. (2013) indicated that

Delphi Technique is a method for the systematic solicitation and collation of judgments on a

particular topic through a set of carefully designed sequential questionnaires interspersed with

summarized information and feedback of opinions derived from earlier responses

6.3 The Nominal Group Technique (NGT)

A manager who must take a decision about an important issue sometimes needs to know what

alternatives are available and how people would react to them. A technique called the nominal

group technique has been developed to fit this situation. Basically, NGT is structured group


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meeting that proceeds as follows: a group of individuals (7 to 10) sit round a table but do not

speak to one another. The problem is presented to them, and they write their reactions, ideas,

suggestions, and views on a sheet of paper. After this process is over, structured sharing of

ideas takes place. Each person around the table presents his ideas. A person designated as

recorder writes the ideas of various members on a blackboard. At the end of it, there is a list of

ideas open for discussion. The next stage involves independent voting in which each participant

selects priorities by ranking or voting. The final group decision is the pooled outcome of the

individual vote.

6.4 Group Decision Support Systems (GDSS)

GDSS is an interactive computer-based systems that are able to combine communication and

decision technologies to help groups make better decisions. Organizations know that having

effective knowledge management systems to share information is important. Research shows

that a GDSS can actually improve the output of group collaborative work through higher

information sharing. Organizations know that having effective knowledge management

systems to share information is important, and their spending reflects this reality. As the

popularity of these systems grows, they risk becoming counterproductive. Humans can only

process so many ideas and information at one time. As virtual meetings grow larger, it is

reasonable to assume that information overload can occur and good ideas will fall through the

cracks, essentially recreating a problem that the GDSS was intended to solve that is to make

sure every idea is heard. Another problem is the system possibly becoming too complicated. If

the systems evolve to a point of uncomfortable complexity, it has recreated the problem of the

bully pulpit and shyness. Those who understand the interface will control the narrative of the

discussion, while those who are less savvy will only be along for the ride. Lastly, many of these

programs fail to take into account the factor of human psychology. These systems could make

employees more reluctant to share information due to lack of control, lack of immediate

feedback, the fear of “flaming” or harsher than normal criticism, and the desire to have original

information hence more power. Khan (2014) indicated that in order to enhance the efficiency

and effectiveness of group meetings, a system known as Group Decision Support System

(GDSS) has been developed.


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7. CONCLUSION

Groups with members who cooperate and communicate well, trust each other, share opinions

and ideas and reach consensus decisions .it can be also suggested that people in organization

prefer to make decisions as a group rather than individually. However it must be bear in mind

that many researchers conclude by stating that it cannot be concluded a 100% that group

decision making is better than individual one. The situation and each individual must be

examined. Moreover nowadays technology has improved dramatically as well as scientific

algorithms have been generated which assist individuals to make better decisions. Also

electronic groups and computerized brainstorming have been developed while at some

instances computer could make the decisions especially in hazard environments. Learning is

also important nowadays since it makes decision making adaptive to rapid changing

environment. Still decision making is a crucial component of organizational management since

bad decisions can damage a business and a career.


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8. REFERENCES

1. Jones, G.R., & George, J.M. (2016). Contemporary Management (9th ed.) New York:

McGraw-Hill Education.

2. Bateman, T.S., Snell, S.A., & Konopaske, R. (2016). Management Leading

Collaborating in a Competitive World (12th ed.) New York: McGraw-Hill Education.

3. Bauer, F., Strobl, A., Dao, M.A., Matzler, K., & Rudolf, N. (2016). Examining Links

between Pre and Post M&A Value Creation Mechanisms — Exploitation, Exploration

and Ambidexterity in Central European SMEs.

4. Steen, M. (2014). Data Collection and Management. University of Chester: Sage.

5. Balasubramaniam, R., & Agarwal, D. (2013). Delphi Technique – A Review. Retrieved

from http://journalgateway.com/ijphd/article/view/444

6. Khan, R.A. (2014). GDSS: Tool for Effective Decision Making. Retrieved from

http://www.ciitresearch.org/dl/index.php/aiml/article/view/AIML032014005.

TOTAL WORDS COUNTED EXCLUDING REFERENCES:

4537 WORDS


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