Attribution theory suggests that when we observe an individual’s behavior, we attempt to determine whether it was internally or externally caused. That determination depends largely on three factors: (1) distinctiveness, (2) consensus, and (3) consistency. Let’s clarify the differences between internal and external causation, and then we’ll discuss the determining factors.

Internally caused behaviors are those an observer believes to be under the personal behavioral control of another individual. Externally caused behavior is what we imagine the situation forced the individual to do. If an employee is late for work, you might attribute that to his overnight partying and subsequent oversleeping. This is an internal attribution. But if you attribute his lateness to a traffic snarl, you are making an external attribution.

Distinctiveness refers to whether an individual displays different behaviors in different situations. Is the employee who arrives late today also one who regularly “blows off” other kinds of commitments? What we want to know is whether this behavior is unusual. If it is, we are likely to give it an external attribution. If it’s not, we will probably judge the behavior to be internal.

If everyone who faces a similar situation responds in the same way, we can say the behavior shows consensus. The behavior of our tardy employee meets this criterion if all employees who took the same route were also late. From an attribution perspective, if consensus is high, you would probably give an external attribution to the employee’s tardiness, whereas if other employees who took the same route made it to work on time, you would attribute his lateness to an internal cause.

Finally, an observer looks for consistency in a person’s actions. Does the person respond the same way over time? Coming in 10 minutes late for work is not perceived the same for an employee who hasn’t been late for several months as for an employee who is late three times a week. The more consistent the behavior, the more we are inclined to attribute it to internal causes.

Exhibit 6-1 summarizes the key elements in attribution theory. It tells us, for instance, that if an employee, Katelyn, generally performs at about the same level on related tasks as she does on her current task (low distinctiveness); other employees frequently perform differently—better or worse—than Katelyn on that task (low consensus); and Katelyn’s performance on this current task is consistent over time (high consistency), anyone judging Katelyn’s work will likely hold her primarily responsible for her task performance (internal attribution).

Errors or biases distort attributions. When we make judgments about the behavior of other people, we tend to underestimate the influence of external factors and overestimate the influence of internal or personal factors.10 This fundamental attribution error can explain why a sales manager attributes the poor performance of her sales agents to laziness rather than to a competitor’s innovative product line. Individuals and organizations tend to attribute their own successes to internal factors such as ability or effort, while blaming failure on external factors such as bad luck or difficult coworkers. Similarly, people tend to attribute ambiguous information as relatively flattering, accept positive feedback, and reject negative feedback. This is called self-serving bias.11

Self-serving biases may be less common in East Asian cultures, but evidence suggests they still operate there.12 Studies indicate Chinese managers assess blame for mistakes using the same distinctiveness, consensus, and consistency cues used by Western managers.13 They also become angry and punish those deemed responsible for failure, a reaction shown in many studies of Western managers. It might just take more evidence for Asian managers to conclude someone else should be blamed.

Any characteristic that makes a person, an object, or an event stand out will increase the probability we will perceive it. Why? Because it is impossible for us to assimilate everything we see; we can only take in certain stimuli. Thus, you are more likely to notice cars like your own, and your boss may reprimand some people, but not others, for doing the same thing. Because we can’t observe everything going on around us, we use selective perception. We don’t choose randomly: we select according to our interests, background, experience, and attitudes. Seeing what we want to see, we sometimes draw unwarranted conclusions from an ambiguous situation.

When we draw an impression about an individual on the basis of a single characteristic, such as intelligence, sociability, or appearance, a halo effect is operating.14 The halo effect is easy to demonstrate. If you knew someone was, say, gregarious, what else would you infer? You probably wouldn’t say the person was introverted, right? You might assume the person was loud, happy, or quick-witted, when in fact gregarious does not include those other attributes. As managers, we need to be careful not to draw inferences from small clues.

An old adage among entertainers is “Never follow an act that has kids or animals in it.” Why? Audiences love children and animals so much that you’ll look bad in comparison. This example demonstrates how the contrast effect can distort perceptions. We don’t evaluate a person in isolation. Our reaction is influenced by other people we have recently encountered.

When we judge someone on the basis of our perception of the group to which he or she belongs, we are stereotyping.15 Stereotypes can be deeply ingrained and powerful enough to influence life-and-death decisions. One study, controlling for a wide array of factors (such as aggravating or mitigating circumstances), showed that the degree to which Black defendants in murder trials looked “stereotypically black” essentially doubled their odds of receiving a death sentence if convicted.16 Another study found that students tended to assign higher scores for leadership potential and effective leadership to Whites than to minorities, supporting the stereotype of Whites as better leaders.17

We deal with the unmanageable number of stimuli of our complex world by using stereotypes or shortcuts called heuristics to make decisions quickly. For example, it does make sense to assume that Allison from finance will be able to help you figure out a forecasting problem. The challenge occurs when we generalize inaccurately or too much.