Group and computer-mediated discussion effects in risk decision making.

Abstract

In this study, we examine hypotheses, based on theories of group decision making and an extension of prospect theory to a social context, about the influence of group communication and group decision processes oa group decisions. Managers individually and in 3-person groups made multiattribute risk choices (two investment alternatives, each with multiple outcomes). Two group decisions were reached during face-to-face discussion, and two were reached during (real-time) computer-mediated discussion. In comparison with prediscussion individual preferences, groups' multiattribute risk choices and attitudes after face-to-face discussion were risk averse for gains and risk seeking for losses, a tendency predicted by prospect theory and consistent with choice shift and other group extremitization research. By contrast, group decisions during computer-mediated discussion did not shift in the direction of prospect theory predictions. The results are consistent with persuasivearguments theory, in that computer-mediated discussion contained less argumentation than face-toface discussion. Social decision schemes were used to evaluate alternative assumptions about the group process. A "(prospect-theory) norm-wins" decision scheme described group choice well in the lace-to-face discussion condition, but not in the computer-mediated discussion condition. Another decision scheme, first-advocate wins, which described choices well in both face-to-face and computer-mediated discussions, was explored in a discussion of the role of communication in group decision making.Risk decision making is important in both prescriptive and empirical analyses of group and organizational behavior. In this research, we draw from research on prospect theory (e.g., Kahneman & Tversky, 1979), multiattribute risk choice (e.g., Payne, Laughhunn, & Crum, 1984), group decision making (e.g., Davis, 1973;Vinokur & Burnstein, 1974), and group computer communication (e.g., Kiesler, Siegel, & McGuire, 1984) to investigate how people make muUiattribute risk choices in groups. Multiattribute risk choices are decisions that have multiple uncertain, or risky, consequences, such as when a finance committee has to consider short-term objectives as well as long-term goals. Organizations frequently delegate multiattribute risk choices to groups because these choices require expertise and perspectives from different parts of the organization. Thus far, however, multiattribute risk choice has been investigated as an individual decision process. One purpose of this research was to extend the generality of prior work by examining how people reach multiattribute risk decisions in groups. By studying decision problems in which individuals'

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