In this research we extend theoretical development about decision making in organizations in which many kinds of errors cannot be tolerated. Catastrophic consequences can be associated with faulty decision making in reliability-seeking organizations, a situation which does not occur in most organizations studied in the past. Observations are drawn from two nuclear-powered aircraft carriers. We find decision processes which appear to change often in these organizations. Important decisions can be made by a number of men even at the lowest levels of the organization. Task-related factors such as technical complexity, high interdependence, and catastrophic consequences associated with rare events and more cognitive factors such as accountability and salience affect decision processes. A model is presented that accounts for dynamic change in decision processes in these organizations.decision making, managing high reliability organizations, decision-making flexibility, accountability, expertise migration, decentralization

A laboratory study examined effects of friendship on expectations of pricing in personal business transactions. Friends expect to pay more but charge less for a variety of commodities than do strangers. Remarkably, without discussion, friends agree on prices for commodities, whereas strangers do not. The result was replicated in a second study and extended to other commodities. The effect may be due to cognitive scripts for transactions with friends.

Social norms constrain people's behaviors in transactions, but such norms are rarely investigated. Script theory provides a coherent, holistic structure for understanding socially mediated behaviors. This study proposes terms of a script for the pricing behavior of transactors when friendship is considered. The script generates testable hypotheses, which are studied in three lab-based experiments. Vignette studies considered the effect of friendship on two-party transactions and revealed consistent behaviors. Without discussion, subjects exhibit consistent agreement for what constitutes appropriate pricing for friends and for strangers in different contexts: when pricing a variety of commodities for a transaction, when acting as agents for a friend or a stranger, and when observing others engaged in such transactions.

A field study of real estate agents' transactions demonstrates that business friendship affects the negotiation process and the outcome of transactions more for agents with 10 or more years of experience in real estate brokerage than for less experienced agents. Newer agents rely more on friendly relations and on impression management techniques to do well in a transaction, while the more experienced agents consider genuine business friendship and its norms useful for facilitating transactions. Different scripts for friendship may explain the consistency within each of the two groups. The study is part of the author's dissertation. It was funded by a grant from the Center for Real Estate and Urban Economics, University of California, Berkeley, California, 94720.The author wishes to thank the Berkeley real estate agents and brokers who generously offered their time and thoughts to this project. Thanks also to Bob Edelstein; to Laurie Kapitelli and William Porter, past presidents of the Berkeley Board of Realtors; and to Dan Ladd and Brian Mundell for their substantial contributions to the design of the survey and to the writing of this paper. This paper has not undergone formal review or approval of the faculty of the ILR School. It is intended to make results of Center research, conferences, and projects available to others interested in human resource management in preliminary form to encourage discussion and suggestions. The Effect of Friendship on Decisions WP 94-09Page 3 ABSTRACTA field study of real estate agents' transactions demonstrates that business friendship affects the negotiation process and the outcome of transactions more for agents with 10 or more years of experience in real estate brokerage than for less experienced agents. Newer agents rely more on friendly relations and on impression management techniques to do well in a transaction, while the more experienced agents consider genuine business friendship and its norms useful for facilitating transactions. Different scripts for friendship may explain the consistency within each of the two groups.