AN ASSIGNMENT OF RESEARCH METHODOLOGY

ON

IMPACT OF LOCUS OF CONTROL ON DECISION

MAKING

SUBMITTED TO; SUBMITTED BY;

Dr. VIVEK SHARMA Mudita Rathi (IM 2K7 56)

Navneet Kaur Hora (IM 2K7 59)
Saumya Sharma (IM 2K7 84)
Rohin Rai (IM 2K7 79)
Souvik Paul (IM 2K7 92)
PURPOSE OF THE RESEARCH
The study aims at clarifying whether locus of control has an impact
on decision-making or not.

DESIGN/ METHODOLOGY/ APPROACH

Altogether 113 public/private/proprietary working professionals,
service class people and businessmen and some PG students
participated in the study. They were asked to fill a questionnaire
including a locus of control test and some questions on their decision
making style.
These respondents were mainly in their late 20’s & early 30’s
and working at middle level in some organizations or running their
own businesses.

FINDINGS
The results revealed that the locus of control has an impact on the
decision making of individuals. Individuals with internal locus of
control were better decision makers than those with external locus of
control.

LOCUS OF CONTROL
Within psychology, Locus of Control is considered to be an
important aspect of personality. The concept was developed
originally Julian Rotter in the 1950s (Rotter, 1966).
Locus of Control refers to an individual's perception about the
underlying main causes of events in his/her life. Or, more simply:
Do you believe that your destiny is controlled by yourself or
by external forces (such as fate, god, or powerful others)?

Some research (McCombs, 1991) suggests that what underlies the

internal locus of control is the concept of "self as agent." This means
that our thoughts control our actions and that when we realize this
executive function of thinking we can positively affect our beliefs,
motivation, and academic performance. "The self as agent can
consciously or unconsciously direct, select, and regulate the use of all
knowledge structures and intellectual processes in support of
personal goals, intentions, and choices" (p. 6).
 McCombs asserts that "the degree to which one chooses to be self-
determining is a function of one's realization of the source of agency
and personal control" (p. 7). In other words, we can say to ourselves,
"I choose to direct my thoughts and energies toward accomplishment.
I choose not to be daunted by my anxieties or feelings of
inadequacy."
The full name Rotter gave the construct was Locus of Control of
Reinforcement. In giving it this name, Rotter was bridging
behavioural and cognitive psychology. Rotter's view was that
behavior was largely guided by "reinforcements" (rewards and
punishments) and that through contingencies such as rewards and
punishments, individuals come to hold beliefs about what causes
their actions. These beliefs, in turn, guide what kinds of attitudes
and behaviors people adopt. This understanding of Locus of
Control is consistent, for example, with Philip Zimbardo (a famous
psychologist):
A locus of control orientation is a belief about whether the outcomes
of our actions are contingent on what we do (internal control
orientation) or on events outside our personal control (external control
orientation)." (Zimbardo, 1985, p. 275)
Thus, locus of control is conceptualized as referring to a
unidimensional continuum, ranging from external to internal:

External Locus of Internal Locus of

Control
Individual believes that
his/her behavior is
guided by fate, luck, or
other external
circumstances
Control
Individual believes that
his/her behavior is
guided by his/her
personal decisions and
efforts.
DECISION MAKING

Decision making is an important process for organizational

effectiveness. Decision making is almost universally defined as
choosing between alternatives. It is closely related to all the
traditional management functions. In the manufacturing area,
effective decisions are aimed at achieving zero defects in recent
years this focus has also been applied to the service sector in order
to create zero defections. Decision making is an organizational
process because it transcends the individual and has an effect on
organizational goals. First the overall nature of the decision making is
explored.

Then the models of behavioural decision making are described. Next,

the traditional and modern participative techniques are presented as
behaviorally oriented decision techniques. Creativity in decision
making can apply to individuals or groups. Since individual decision
making has largely given way to group decision making in today,
organizations, an under standing of group dynamics become
relevant. In fast a no of social decision schemes have emerged.
Decisions can be classified as either programmed or non-
programmed. Programmed decisions are repetitive or routine & can
be solved through clear-cut mechanical procedures, such as applying
the rules to find the best solution. Up to 90 percent of management
decisions are programmed. Non-programmed decisions are
exceptional or non-recurring, and they are often made under crisis
conditions which involve so much ambiguity that specific procedures
or programs are not available. Therefore, managers who must make
non-programmed decisions rely on judgment and creativity.

ANALYSIS OF THE RESEARCH

The Null Hypothesis states than “locus of control has no effect on
Decision making”.
Out of the 113 respondents 85 were found to have an internal locus
of control while 28 had an external locus of control.
The calculated Z value was 4.1167 which is more than the
standard value of 1.96.
Hence the Null Hypothesis is rejected & Alternate Hypothesis is
accepted which states that “Locus of control has an impact on
decision making”.

The calculated mean of decision making of people with internal locus

of control (3.199553) is higher than the calculated mean of decision
making of people with external locus of control (2.899964).

Thus it proves that individuals with internal locus of control are

better decision makers than those with external locus of control.

ORIGINALITY/ VALUE OF THE RESEARCH

The results of the present study are valuable for HRM practice,
especially with regard to the selection of individuals to management
teams.

It helps in the selection & training procedures within an organization.

Also the implications will be helpful in assigning proper
responsibilities to employees according to the psychological aspects
of their personality.