3 factors in business environments: Information, Risk and People; Complete info, no uncertainty (Trenches) to No Info, complete uncertainty (Entre

C level)
Management: Coping with Complexity, Leadership: Coping with change Assumptions of Economic Paradigm: EM Hypoth., rationality & Gaussian Uncertainty
Types of Uncertainty: Known-Knowns, Known Unknowns and Unknown Knowns: Intuition based Decision Making vs Knowledge based Decisions
Derailment occurs when a manager wants to move ahead but is instead fired, demoted, or plateaus below expected levels of achievement. Defined as little
chance of future advancement due to misfit between job requirements & personal skills. 30-50% high potential managers derail; costly to individuals & orgs.
Reasons of Derailment: Problems with interpersonal relationships; Failure to meet business objectives; to build & lead a team; Inability to change during
transition; too narrow a functional background; Distinction b/w Derailed and Successful Limited self-awareness; Over estimated their abilities; Over relied on
strengths that served them well in the past but may not serve them as well now; Used narrow skill set and one-size-fits all approach to solving problems
Project Oxygen: 3 reasons why people leave: No sense that their work matters; Dislike co-workers; Terrible boss the biggest variable. Bosses have the
greatest impact on employee performance and how they feel about a company. Steps Taken: Data mining by the people analytics team performance
reviews, feedbacks, nominations, etc correlated phrases, words, praise, complaints. Eight habits of highly effective Google managers pretty obvious stuff:
have clear vision and strategy; help employees with career development; be results-oriented. Got interesting when they ranked them. Technical expertise
ranked last; managers who took interest in, made time for and were accessible to subordinates were most valued. New data-driven analytical approach to HR.
Improvement in 75% of worst performing managers. Data-driven approach to other areas: hiring & reviews. Also compiled a list of cognitive biases.
Perceptual Shortcuts: Halo Effect (Drawing general impression from a single characteristic), Stereotyping (Judging someone on the basis of our perception of
the group to which he/she belongs), Self-serving Attribution (Maintaining a positive self-image/high self-esteem, good-dispositional, bad-situational attributes),
Fundamental Attribution error (On Others action- Underestimating the role of chance in life).
Weiners Framework (Internal vs External (Stable (Controllable vs UnC.) vs Temporary (Controllable vs UnC.)) and Kelleys Framework (Distinctiveness is the
behavior same across situations?- Is the behavior unusual-if yes:external attribution. Consensus how do others behave in this situation- Is the consensus
high- If yes: external attribution. Consistency is the behavior repeated in this situation across time- Is the behavior inconsistent? If yes: external attribution)
Risk and Uncertainty: Outcomes should have Value and Uncertain, No Risk no Return. Scenario Analysis- Why NPV analysis is less accurate-Uses single most
likely scenario and ignores other possibilities. Scenario analysis creates multiple possible scenarios: Best case vs worst case gives measure of overall risk. Is
worst case scenario catastrophic? Steps: Determination of critical factors (eg., state of economy, regulatory); Determine values each factor can take; Create
multiple scenarios & determine outcomes (cash flows) for each; Assign probabilities to each scenario, Do sensitivity analysis.
Prospect Theory: Amor Tversky and Kahneman: Reference Point, Loss Aversion, Risk averse for gains and risk seeking for losses, Probability weighting.
Homo Sapien: Bounded Rationality: They Satisfice not optimize, need to understand our cognitive limitations like we understand our physical limitations
Compromise Effect (take the middle one-Economist), Framing Bias (The way a problem is framed can profoundly influence the decision you make), Narrow
Bracketing (individual decisions that each seem sensible but when viewed as a whole is suboptimal- Lottery Question) Availability/Saliency Bias (Being overly
influenced by vivid & recent memories while making judgments/estimations). Confirmation Bias (Seeking & overweighing info that supports your existing pt
of view; Examine ALL evidence equally, confirming & disconfirming; Status Quo Bias (Favoring alternatives that perpetuate the existing situation, ASK- Would
you choose the status quo if it werent the status quo?) Anchoring Bias (Giving disproportionate weight to the first info you receive (relevant or irrelevant;
quantitative or qualitative) Sunk Cost Bias (Giving disproportionate weight to the first info you receive (relevant or irrelevant; quantitative or qualitative)
Overconfidence: 3 types; Over-Estimation, Over Placement, Over Precision
Inattentional Blindness: We miss a lot of what goes on around us and are aware of far less around us than we think; Focus so hard on something that we
become blind to the unexpected even when we are staring at it. It is easy to miss details when you are not looking for them. Change Blindness: Change
blindness, failure to detect changes in the environment caused by visual (or other) distraction, Mostly due to Short-term memory not storing info abt environm.
Conceptual Learning Types: Assimilation Concept-driven, top-down processing: perceptions guided by expectations and prior knowledge (quicker perceptual
recognition, improved comprehension & recall; anchoring and confirmation biases); Accomodation: (Data-driven, bottom-up processing; perception guided by
objective characteristics of the stimulus).. Selective Perception: (We perceive only a subset of stimuli depending on our own interests and experience, intention)

Properties of Perception: Holistic (word paragraph experiment); Constructed; Contrast & assimilation (Perceptual organization is bipolar either minimize
stimulus differences to make the perceptual field homogenous (assimilation), or accentuate them if stimulus differences exceed a certain level (contrast));
Relative (used in packaging, seems big in big cone. Just noticeable differences (JND) smallest change in stimulus that one can detect. Perceptual system works
on percentage increments. Absolute levels are important.); Automaticity (Cognitive Miser); Adaptation (We get used to stationary states; Our senses; Income,
lifestyle, well-being, aka Impact Bias); Expectation self-fulfilling prophecy (Knowledge colors Perception); Brands (Pepsi- Blind test, NeuroMarketing, Blind:
50-50; response in ventromedial prefrontal cortex (reward processing); Knowledge of Coke: 75-25; response in lateral prefrontal cortex (cognition) &
hippocampus (memory))

Social Proof: Principle of social proof: we determine what is correct by finding out what other people think is correct. (e.g., canned laughter), generally
advantageousBUT Morbid side of social proof: Immediately following highly publicized stories of suicide, # of suicides increase multifold, People dying in
commercial airline crashes increase, Automobile fatalities increase multifold.) Wider the publicity, greater the impact. Stories in which only 1 person dies
increase the rate of subsequent single-fatality incidents. Stories in which multiple people die increase the rate of subsequent multiple-fatality incidents. Age of
suicide-story victim correlates highly with the ages of lone drivers killed in single-car crashes immediately after story appeared. Md. Bouazizi & the Arab Spring

DM Framework: Ask Yourself (Self-Interested Biases, Affect Heuristic, GroupThink), Ask Proposers (Saliency, Confirmation Bias, Availability Bias, Anchoring Bias,
Halo Effect, Sunk Cost Fallacy), Ask about Proposal (Overconfidence, Planning Fallacy, Optimistic Biases, Competitor Neglect, Disaster Neglect, Loss Aversion).

Measurement of Personality: Self report surveys (Most common; easy to administer, incorrect reporting) Observer-ratings surveys (coworker ratings),
Perceptual issues, Conflict of interest issues) Projective measures (Rorschach ink-blot, Thematic Aptitude TestInconsistent, Not effective)
MBTI- Extraverted or Introverted, Sensing(Practical)/iNtuitive, Thinking(Data) or Feeling (Emotions), Judging (Structure) or Perceiving (Flexible or Spontaneous).
Big 5- OCEAN Conscientiousness (Interest in leading a structured and organized life), Agreeableness (The tendency to go along to get along),
Neuroticism/emotional stability (Most strongly related to life & job satisfaction, low stress, fewer health complaints), Openness to experience, Extraversion
Six features of emotions: Cognitive antecedents: Emotions differ from visceral factors like pain and hunger in that they are largely triggered by beliefs, though
some emotions may be triggered by sensory signals; Intentional objects: Emotions are about something; Physiological arousal: are characterized by hormonal
changes and changes in the autonomic nervous system; Physiological expressions: characteristic observable expressions and bodily postures which can serve
as signals to others; Valence: Term used to denote that emotions are located on a pleasure-pain scale, with a neutral zero point of emotional indifference;
Action tendencies: states of readiness to execute a given kind of action Action tendencies have the character of urges or impulses. (Frijda 1986)

Moods: Moods are different from emotions in that they are object-less and free-floating and lasting for longer time periods; Feelings is used to denote
awareness of bodily sensations (Lazarus 1991); Emotions lead to feelings, but feelings do not imply emotions

Emotions influence human behavior through their action tendencies. Selective activation of memory structures: Pictures are better remembered; Mood
influences recollection of events experienced in the same mood; Selective priming of cognitive constructs; Selective absorption of mood-congruent information;
System influencing the choice of relevant stimuli; Over-prediction of emotions-affects trade-offs; Fearful people expressed pessimistic risk estimates and risk-
averse choices, while angry people, resembling happy ones, expressed the opposite; Positive affect induces more risk aversion in lotteries of high stakes and
more risk seeking in lotteries of low stakes; Sad individuals prefer high-risk/high-reward options, where as anxious individuals favour low-risk/low-reward
options. Good (bad) moods lead to less (more) risk tolerance in capital markets; Guilt induces greater risk aversion, while the opposite is true when the person
feels like a victim; People are generally risk averse in their own choices, but risk neutral in their prediction for the average student; Expression of organizationally
desired emotions during interpersonal transactions at work; Emotional dissonance; Felt vs displayed emotions; Faking Surface acting; Deep acting

Emotional Intelligence: Ability to perceive and distinguish and understand emotions in self and others; Ability to manage and regulate ones emotions; EI
weakly but consistently correlates with job performance; and increasingly used as a factor for hiring decisions; People in good moods tend to be more creative;
Positive emotions enhance problem solving skills, improves persistence and motivation and promote flexibility and openness in thinking; Yerkes-Dodson law
(Bell curve-of stress and performance); Leadership speak to the emotions change management; Deviant workplace behaviors

Maslows Hierarchy: Physiological->Safety->Social->Esteem (Internal: Self Respect, Autonomy, External: Status, Recognition, Attention) ->Self-Actualization.
TheoryX vs TheoryY- Employees dislike work and must be supervised vs employees view work as natural as rest/play and seek autonomy/resp. Two-Factor
theory (Frederick Herzberg): Also called motivation-hygiene theory; Asked situations in which they felt good or bad about their jobs; Dimensions that made
people feel good were different from those that made them feel bad; Opposite of satisfaction is no satisfaction; Opposite of dissatisfaction is no dissatisfaction
McClellands theory of Needs: Need for achievement (nAch): drive to excel; Need for power (nPow): need to make others behave in ways in which they would
not have behaved otherwise; Need for affiliation (nAff): desire for interpersonal relationships. High nAch: Strongly motivated when jobs have high degree of
personal responsibility and intermediate risk; Successful in entrepreneurial activities; Does not necessarily make one a good manager interested in how well
they do and not in influencing others; Best managers tend to have high nPow and low nAff. Goal Setting Theory: Specific goals increase performance; Difficult
goals, when accepted, lead to higher performance than easy goals; Feedback leads to higher performance; Participative vs. assigned goals; Commitment to
goal is high: When goals are made public; Internal locus of control; Participative. Implementation: Management by objectives (MBO). Equity Theory: Monkey,
Employees make comparisons of their job inputs and outcomes with those of others. O/ISELF < O/IOTHER => Under-rewarded => anger; O/ISELF = O/IOTHER => Equity.
Equity theory-referent comparison (Inside vs Outside; Self vs Other). Expectancy Theory: Probability to act in a certain way depends on the probability that the
act will result in a given outcome and the utility of that outcome. Effort-performance: Perceived probability that exerting effort will be lead to performance.
Performance-reward: Degree to which one believes that good performance will lead to organizational rewards. Rewards-personal goals: Degree to which
organizational rewards satisfy ones personal goals and needs. Buy recos vastly outnumber sell recos? Job Characteristics Model-JCM- Individuals obtain internal
rewards when they learn (knowledge of results from feedback) that they personally (experienced responsibility from autonomy) have performed well on a task
they care about (experienced meaningfulness from SV, TI & TS). Motivation Potential Score (MPS) = (Skill Var+Task Id+Task Sig) x (1/3) x Autonomy x Feedback.
3 theories: Altruism/Intrinsic Motivation; Reciprocity/Extrinsic Motivation; Selfish Maximization. Two Worlds: Social and Market Norms- Introducing monetary
payments into a social exchange will cause individuals to shift from perceiving the exchange as a Social-Market to a Money-Market. Cash-Candy Expt- No
payment is a social market and thus higher in effort. Thinking about money- More self-reliance; less willing to ask for help; Less willing to help others (selfish);
More likely to seek tasks requiring individual input rather than teamwork. Ex- Day Care in Israel and Lawyers of AARP.

Attitudes: Evaluative statements favorable or unfavorable about objects, people, or events. Reflects how we feel about something. I like IIMB. Studies
of people with selective brain damage who can think rationally but have no feelings show they cannot decide! (See Descartes Error by Antonio Damasio).
Components of Attitude: Cognitive (evaluative statement of belief My pay is low); Affective: emotional / feeling I am angry that my pay is low;
Behavioral: action tendency, intention to act. Cognitive dissonance: incompatibility between 2 attitudes or some behavior and an attitude creates tension.
Attempt to reduce dissonance by changing attitude or behavior (Leon Festinger: Boring Task for 60 mins and convince others that its interesting- 0, $1, $20)

Managing Bad Habits (Waldroop and Butler): Inability to see other peoples perspective; When and how to use power; Not coming to terms with authority;
Negative self-image. Hero; Rebel; HomeRun Hitter; Meritocrat; Bulldozer; Pessimist.

What Makes a Leader: Daniel Goleman- Evaluating EI: Self-Awareness (the ability to recognize and understand your moods), Self-Regulation (ability to control
disruptive impulses), Motivation (Passion to work for reasons beyond money and recognition), Empathy, Social Skill. EI- 90% diff b/w star and avg. employees.

Pygmalion: One person can transform another, depending on the treatment that is given. Impact on Productivity: effect of positive expectation; effect of self
fulfilling prophecies; common failure pattern. Managers are more effective in communicating low expectations to their subordinates than in communicating
high expectations to them, though managers believe exactly the opposite! Impossible Dreams: Managers high expectations must pass the test of reality before
they can be translated into performance. Subordinates will not be motivated unless they consider the high expectations realistic and achievable. If goals are
unattainable they will eventually give up. Managerial Expectation Influence Young People: Expectations and performance in the first year is highly correlated
with the later performance and success. Most Influential Boss: If managers are unable or unwilling to develop the skills of young employees with high aspiration,
the latter develop negative attitude towards jobs, employers eventually leaving the company for better opportunities. Astute Selection Successful managers
give up on their subordinates slowly because that mean questioning their own judgment & selection. Disillusion and Turnover: Initial expectations for
performance molds subsequent expectations and behavior. Often, managers lack knowledge and skill to develop capabilities of subordinates. Generation Gap
 nearly 54% managers believed that new recruits were not as good as they were 5 years ago. Underdevelopment, underutilization and ineffective
management of talent. Our Actions->Other Beliefs->Other Actions-> Our Beliefs->Our Actions. The Pygmalion Effect cycle.

Hiring vs Growing Stars: According to a study, stars performance actually dips by 20% permanently when they switch organizations. Fundamental Attribution
error- Star performance depend on company capabilities and resources, Systems and Processes, Leadership, Training, Internal Networks and Teams (70%).
Grow your stars: Better performer & more loyal. Recruit good people, develop and retain them. If hiring, then provide the requisite environment

Dangerous Myths about Pay: Labour Cost = Labour rate; Labour Cost can reduced by Labour rate; Labour Costs constitute a significant portion of total costs;
Low Labour Costs are a potential and sustainable competitive weapon; Individual incentive pay improves performance; People work for money. Group oriented
compensation systems decreased grievances, increased product quality by 10X & improved perception of teamwork. Merit Pay had no effect on performance.

Managing Oneself: Drucker : Companies today arent managing their knowledge workers careers. We need to be our own CEO. Our strengths and weaknesses;
How do we learn and work with others; Most deeply held values (Mirror Test); Type of work environment in which we can make the greatest contribution.
Goal- Shouldnt be longer than 18mts, must be hard to achieve and shud be within reach, make a difference in the present situation and meaningful.
Relationships: Take the resp of your relationships, managing your boss and co-workers, take resp of communication. Second Innings: Manual vs Knowledge
Workers, 45yrs age, not deriving satisfaction/challenge. Leads to a 2nd career (Start a new career, Parallel Career, Social Entre.

Managing Multicultural Teams: Direct vs Indirect Comm; Trouble with accents; Differing attitudes towards hierarchy and authority, Conflicting norms for DM.
Dealing with them: Adaptation to culture not to personality, Complete Understanding of culture diff., Structural Intervention, Managerial Intervention, Exit

What it means to work here: Erickson & Gratton: Target a segment of potential employees->Address specific business needs (Design your signature
experience)->Identify and Preserve History, Rituals-> Share your Stories -> Strive for Consistency -> Have the courage of your convictions, helps in retention.