Framing in Organizational Decision Making

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Decision-making is a rather important and responsible process that determines, to a great extent, the success of every single individual and even the whole organization. However, decision making can be misleading, and framing is one of the traps that people use to convince others in their ideas and turn their decision to their advantage. The case under consideration presents the bright example of the successful framing used by the salesperson to shape the decision made by Ron.

To start the discussion of Rons framing, it is necessary to define the latter. As Gonzalez, Dana, Koshino, and Just (2005) argue, The framing effect is observed when a decision makers risk tolerance (as implied by their choices) is dependent upon how a set of options is described. Specifically, peoples choices when faced with consequentially identical decision problems framed positively (in terms of gains) versus negatively (in terms of losses) are often contradictory (p. 2). Thus, Rons framing took place under the influence of positive description of the goods the salesperson was set to sell. The thinking process of Rons can be outlined through the following ideas shaping his reasoning:

  • We bought equipment from this firm and it proved to be of high quality and efficiency;
  • Additional options will definitely facilitate the equipment efficiency;
  • Cost of the additional options is too high for our company;
  • Potential benefits of those additional options outweigh costs, and the salesperson has managed to convince me in this.

These are the ideas that framed Rons decision to agree on purchasing the additional options offered by the salesperson. However, if another framing technique was used to present the additional options to Ron his decision might be different. As De Martino, Kumaran, Seymour, and Dolan (2006) argue, positive and negative descriptions of goods can change the decisions made (p. 684). The salesperson presented the potential benefits of additional options purchase to Ron, and his decision was favorable to her. If she presented the negative side of the purchase, the framing would be different as well as the decision made.

For example, if the expensiveness of the additional options was presented as the major factor in the purchase, Ron would have thought twice before making the deal. As well, if the salesperson or any of Rons assistants drew his attention to the fact that the promised benefits of the additional options are not guaranteed and depends on numerous other factors, the decision would be different as well. As Plous (1993) argues, people believe in what they are convinced to, and if the negative description of the purchase were more convincing, Ron would, as any other human being under the influence of framing effect, make another decision.

Drawing from this, framing can be viewed dually. On the one hand, it is the powerful tool of persuasion and its results can be positive when dealing with conservatism that does not allow making necessary innovations to organizations, policies, etc (Plous, 1993). However, moral implications of framing are negative as framing is the tool influencing somebodys will and using it to make decisions necessary to another person. Therefore, framing cannot be called a moral and ethical phenomenon.

To conclude, decision making is an important process for an individuals and organizations success, but framing is one of the main traps to free decision making. People are subjected to persuasion, and when framing is applied their decisions tend to support the side which is depicted more convincingly. Thus, if the benefits of an activity are depicted more attractively the decision will be one, and if the negative sides of the phenomenon dominate in framing, the decision will be another.

References

De Martino, B., Kumaran, D., Seymour, B., and Dolan, R. (2006). Frames, Biases, and Rational Decision-Making in the Human Brain. Science, 313(5787), 684  687.

Gonzalez, C., Dana, J., Koshino, H., and Just, M. (2005). The framing effect and risky decisions: Examining cognitive functions with fMRI. Journal of Economic Psychology, 26 (2005), 120.

Plous, S. (1993). The Psychology of Judgment and Decision Making. McGraw-Hill Humanities/Social Sciences/Languages; 1 edition.

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