critical thinking and decision making in business

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To Improve Critical Thinking, Don’t Fall into the Urgency Trap

Too often at work, people rely on expertise and past experiences to jump to a conclusion. Yet research consistently shows that when we rush decisions, we often regret them—even if they end up being correct. [i]

Why we hasten decision making is quite clear. We’re inundated with incessant distractions that compete for our attention, and, at the same time, we’re facing profound pressure to go faster and drive our businesses forward, even when the path ahead is unclear.

In the aftermath of information overwhelm, evolving technology, and rapidly changing business environments, people often unconsciously fall into a pernicious paradox called the “urgency trap.”

The Urgency Trap

The urgency trap, which can be defined as the habitual, unbridled, and counterproductive tendencies to rush through decision making when under the pressure of too many demands, is a paradox because it limits the very thing that could help us be more innovative, efficient, and effective: Our critical thinking.

The ability to analyze and effectively break down an issue to make a decision or solve a problem in novel ways is sorely lacking in today’s workforce, with most employers reporting that their employees’ critical thinking skills are average at best. [ii]

The good news? Critical thinking is a teachable skill, and one that any person can learn to make time for when making decisions. To improve and devote time for critical thinking at work, consider the following best practices.

1. Question assumptions and biases

Consider this common scenario: A team is discussing a decision that they must make quickly. The team’s options—and the arguments for and against them—have been assembled, but no clear evidence supports a particular course of action. Under pressure to move fast, the team relies on their expertise and past experiences to rapidly provide a solution. Yet, in the months following their decision, the issues that prompted the original discussion persist, and the team wonders why.

The issue here may be that the team failed to question their own assumptions and biases. Indeed, when we view situations solely based on our own personal experiences and beliefs, we limit our options and provide solutions that are often short-sighted or superficial. [iii] To improve critical thinking skills, we must step back and ask ourselves,

• “Am I seeking out information that confirms my pre-conceived idea?”
• “Am I perceiving a past experience as more predictable than it actually was?”
• “Am I overemphasizing information that comes to mind quickly, instead of calculating other probabilities?”

2. Reason through logic

When presented with an argument, it is important to analyze it logically in order to determine whether or not it is valid. This means looking at the evidence that is being used to support the argument and determining whether or not it actually does support the conclusion that is being drawn.

Additionally, consider the source of the information. Is it credible? Trustworthy? Finally, be aware of common logical fallacies people tend to use when trying to speed up decision making, such as false dilemma (erroneously limiting available options) and hasty generalizations (making a claim based on a few examples rather than substantial proof).

3. Listen actively and openly

When we’re in a rush to make a decision, we often focus more on how we want to respond rather than what the speaker is saying. Active listening, on the other hand, is a critical thinking skill that involves paying close attention to what someone else is saying with the intent to learn, and then asking questions to clarify and deepen understanding.

When engaging in active listening, it’s important to avoid interrupting and instead allow the other person to fully express their thoughts. Additionally, resist the urge to judge or criticize what the other person is saying. Rather, focus on truly understanding their perspective. This may mean practicing open-mindedness by considering new ideas, even if they challenge existing beliefs. By keeping an open mind, this ensures that all sides of an issue are considered before coming to a conclusion.

4. Ask better questions

In an article for Harvard Business Review, John Coleman, author of the HBR Guide to Crafting Your Purpose , writes, “At the heart of critical thinking is the ability to formulate deep, different, and effective questions.” [iv]

To ask better questions, first consider the audience for the question (who is hearing the question and who might respond?) and the purpose (what is the goal of asking this question?). Then, approach queries with rigor and curiosity by asking questions that:

• Are open-ended yet short and direct (e.g., “How might you help me think about this differently?”)
• Challenge a group’s conventional thinking (e.g., “What if we tried a new approach?”)
• Help others reconsider their first principles or hypotheses (e.g., “As we look at the data, how might we reconsider our initial proposed solution?”)
• Encourage further discussion and analysis (e.g., “How can we deepen our understanding of this issue?”)
• Thoughtfully follow up on the solution (e.g., “How do we feel about the progress so far?”)

5. Create space for deliberation

The recommendations outlined thus far are behaviors and capabilities people can use in the moment, but sometimes, the best solutions are formulated after consideration. In fact, research shows that a deliberate process often leads to better conclusions. [v] And sleep has even been proven to help the brain assimilate a problem and see it more clearly. [vi]

When issues are complex, it’s important to find ways to resist unnecessary urgency. Start by mapping out a process that allows several days or longer to sit with a problem. Then, create space in the day to formulate in quiet reflection, whether that’s replacing your first thirty minutes in the morning with thinking instead of checking email, or going on a walk midday, or simply journaling for a few moments before bed.

Critical Thinking Cannot Be Overlooked

In the face of rapidly-evolving business environments, the ability to make smart decisions quickly is one of a company’s greatest assets—but to move fast, people must first slow down to reason through pressing issues, ask thoughtful questions, and evaluate a topic from multiple angles.

To learn more about how organizations can enhance their critical thinking and decision-making skills, download the full paper: Who Is Really Making the Decisions in Your Organization — and How?

[i] Grant Halvorson, Heidi, “Quick Decisions Create Regret, Even When They Are Good Decisions,” Fast Company. https://www.fastcompany.com/1758386/quick-decisions-create-regret-even-when-they-are-good-decisions .

[ii] Plummer, Matt, “A Short Guide to Building Your Team’s Critical Thinking Skills,” Harvard Business Review, October 2019. https://hbr.org/2019/10/a-short-guide-to-building-your-teams-critical-thinking-skills .

[iii] Benjamin Enke, Uri Gneezy, Brian Hall, David Martin, Vadim Nelidov, Theo Offerman, and Jeroen van de Ve, “Cognitive Biases: Mistakes or Missing Stakes?” Harvard Business School, 2021. https://www.hbs.edu/ris/Publication%20Files/21-102_1ed838f2-8ef3-4eec-b543-d00eb1efbe10.pdf

[iv] Coleman, John, “Critical Thinking Is About Asking Better Questions,” Harvard Business Review, April 2022. https://hbr.org/2022/04/critical-thinking-is-about-asking-better-questions .

[v] Markovitz, Daniel, “How to Avoid Rushing to Solutions When Problem-Solving,” Harvard Business Review, November 2020. https://hbr.org/2020/11/how-to-avoid-rushing-to-solutions-when-problem-solving .

[vi] Miller, Jared, “Does ‘Sleeping On It’ Really Work?” WebMD. https://www.webmd.com/sleep-disorders/features/does-sleeping-on-it-really-work .

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Why Critical Thinking Matters in Your Business

Critical thinking should become a second-nature skill for leaders and employees across your organization.

Table of Contents

Many professionals hope to pursue careers they’re passionate about so they can find joy and meaning in their work. Caring deeply about your work is vital for engagement and productivity, but balancing emotions with critical thinking is essential in the workplace. 

When employees engage in critical thinking, they use an independent, reflective thought process to evaluate issues and solve problems based on knowledge and objective evidence. 

Critical thinking skills can guide your organization toward success, but to truly maximize the problem-solving benefits of critical thinking, it’s crucial to teach this skill to your entire team. We’ll explore critical thinking skills and how to teach them in the workplace to help your business improve its decision-making and problem-solving. 

What is critical thinking?

Jen Lawrence, co-author of Engage the Fox: A Business Fable About Thinking Critically and Motivating Your Team , defines critical thinking as “the ability to solve problems effectively by systematically gathering information about an issue, generating further ideas involving a variety of perspectives, evaluating the information using logic, and making sure everyone involved is on board.”

This is a complex definition for a challenging concept. Though critical thinking might seem as straightforward as stepping back and using a formal thinking process instead of reacting instinctively to conflicts or problems, it is actually a much more challenging task.

Critical thinking’s ultimate goal is ensuring you have the best answer to a problem with maximum buy-in from all parties involved – an outcome that will ultimately save your business time, money and stress.

Why is critical thinking essential in the workplace?

A World Economic Forum report revealed that critical thinking is one of the most in-demand career skills employers seek when trying to attract and retain the best employees – and employers believe critical thinking skills will become even more necessary in the coming years. 

Critical thinking in the workplace guarantees objective and efficient problem-solving, ultimately reducing costly errors and ensuring that your organization’s resources are used wisely. Team members employing critical thinking can connect ideas, spot errors and inconsistencies, and make the best decisions most often. 

Employees with critical thinking are also more likely to accomplish the following:

• Analyzing information
• Thinking outside the box
• Coming up with creative solutions to sudden problems
• Devising thought-through, systematic plans
• Requiring less supervision

What are critical thinking skills?

Critical thinking is a soft skill that comprises multiple interpersonal and analytical abilities and attributes. Here are some essential critical thinking skills that can support workforce success.

• Observation: Employees with critical thinking can easily sense and identify an existing problem – and even predict potential issues – based on their experience and sharp perception. They’re willing to embrace multiple points of view and look at the big picture. 
• Analytical thinking: Analytical thinkers collect data from multiple sources, reject bias, and ask thoughtful questions. When approaching a problem, they gather and double-check facts, assess independent research, and sift through information to determine what’s accurate and what can help resolve the problem. 
• Open-mindedness: Employees who demonstrate critical thinking are open-minded – not afraid to consider opinions and information that differ from their beliefs and assumptions. They listen to colleagues; they can let go of personal biases and recognize that a problem’s solution can come from unexpected sources. 
• Problem-solving attitude: Critical thinkers possess a positive attitude toward problem-solving and look for optimal solutions to issues they’ve identified and analyzed. They are usually proactive and willing to offer suggestions based on all the information they receive. [Related article: How to Develop a Positive Attitude in the Workplace ]
• Communication: When managers make a decision, they must share it with the rest of the team and other stakeholders. Critical thinkers demonstrate excellent communication skills and can provide supporting arguments and evidence that substantiate the decision to ensure the entire team is on the same page. 

What are the benefits of critical thinking in the workplace?

Many workplaces operate at a frantic tempo that reinforces hasty thinking and rushed business decisions, resulting in costly mistakes and blunders. When employees are trained in critical thinking, they learn to slow the pace and gather crucial information before making decisions. 

Along with reducing costly errors, critical thinking in the workplace brings the following benefits: 

• Critical thinking improves communication. When employees think more clearly and aren’t swayed by emotion, they communicate better. “If you can think more clearly and better articulate your positions, you can better engage in discussions and make a much more meaningful contribution in your job,” said David Welton, managing partner at Grove Critical Thinking.
• Critical thinking boosts emotional intelligence. It might seem counterintuitive to associate analytical rationality with emotional intelligence . However, team members who possess critical thinking skills are less prone to rash, emotion-driven decisions. Instead, they take time to analyze the situation and make the most informed decision while being mindful and respectful of the emotional and ethical implications. 
• Critical thinking encourages creativity. Critical thinkers are open to new ideas and perspectives and accumulate a significant amount of information when facing decisions. Because of this, they’re more likely to come up with creative solutions . They are also curious and don’t shy away from asking open-ended questions. 
• Critical thinking saves time and money. By encouraging critical thinking in the workplace, you minimize the need for supervision, catch potential problems early, promote independence and initiative, and free managers to focus on other duties. All this helps your company save valuable time and resources. 

How do you teach critical thinking in the workplace?

Experts agree that critical thinking is a teachable skill. Both Lawrence and Welton recommend exploring critical thinking training programs and methods to improve your workplace’s critical thinking proficiency. Here’s a breakdown of how to teach critical thinking in the workplace: 

• Identify problem areas. Executives and managers should assess workplace areas most lacking in critical thinking. If mistakes are consistently made, determine whether the issue is a lack of critical thinking or an inherent issue with a team or process. After identifying areas that lack critical thinking, research the type of training best suited to your organization. 
• Start small. Employees newly embracing critical thinking might have trouble tackling large issues immediately. Instead, present them with smaller challenges. “Start practicing critical thinking as a skill with smaller problems as examples, and then work your way up to larger problems,” Lawrence said.
• Act preemptively. Teaching and implementing critical thinking training and methodology takes time and patience. Lawrence emphasized that critical thinking skills are best acquired during a time of calm. It might feel urgent to seek critical thinking during a crisis, but critical thinking is a challenging skill to learn amid panic and stress. Critical thinking training is best done preemptively so that when a crisis hits, employees will be prepared and critical thinking will come naturally.
• Allow sufficient time. From a managerial perspective, giving employees extra time on projects or problems might feel stressful in the middle of deadlines and executive pressures. But if you want those working for you to engage in critical thinking processes, it’s imperative to give them ample time. Allowing employees sufficient time to work through their critical thinking process can save the company time and money in the long run.

How do you identify successful critical thinking?

Successful critical thinking happens during a crisis, not after.

Lawrence provided an example involving restaurants and waitstaff: If a customer has a bad experience at a restaurant, a server using critical thinking skills will be more likely to figure out a solution to save the interaction, such as offering a free appetizer or discount. “This can save the hard-earned customer relationship you spent a lot of marketing dollars to create,” Lawrence said. This concept is applicable across many business and organizational structures. 

You should also be aware of signs of a lack of critical thinking. Lawrence pointed out that companies that change strategy rapidly, moving from one thing to the next, are likely not engaging in critical thinking. This is also the case at companies that seem to have good ideas but have trouble executing them.

As with many issues in business, company leadership determines how the rest of the organization acts. If leaders have excellent ideas but don’t follow critical thinking processes, their team will not buy into those ideas, and the company will suffer. This is why critical thinking skills often accompany positive communication skills.

“Critical thinking doesn’t just help you arrive at the best answer, but at a solution most people embrace,” Lawrence said. Modeling critical thinking at the top will help the skill trickle down to the rest of the organization, no matter your company’s type or size.

Critical thinking is the key to your business success

When critical thinking is actively implemented in an organization, mistakes are minimized, and operations run more seamlessly. 

With training, time and patience, critical thinking can become a second-nature skill for employees at all levels of experience and seniority. The money, time and conflict you’ll save in the long run are worth the extra effort of implementing critical thinking in your workplace.

Rebecka Green contributed to the writing and reporting in this article. Source interviews were conducted for a previous version of this article.

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How to build critical thinking skills for better decision-making

It’s simple in theory, but tougher in practice – here are five tips to get you started.

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Have you heard the riddle about two coins that equal thirty cents, but one of them is not a nickel? What about the one where a surgeon says they can’t operate on their own son?

Those brain teasers tap into your critical thinking skills. But your ability to think critically isn’t just helpful for solving those random puzzles – it plays a big role in your career. 

An impressive 81% of employers say critical thinking carries a lot of weight when they’re evaluating job candidates. It ranks as the top competency companies consider when hiring recent graduates (even ahead of communication ). Plus, once you’re hired, several studies show that critical thinking skills are highly correlated with better job performance.

So what exactly are critical thinking skills? And even more importantly, how do you build and improve them? 

What is critical thinking?

Critical thinking is the ability to evaluate facts and information, remain objective, and make a sound decision about how to move forward.

Does that sound like how you approach every decision or problem? Not so fast. Critical thinking seems simple in theory but is much tougher in practice, which helps explain why 65% of employers say their organization has a need for more critical thinking. 

In reality, critical thinking doesn’t come naturally to a lot of us. In order to do it well, you need to:

• Remain open-minded and inquisitive, rather than relying on assumptions or jumping to conclusions
• Ask questions and dig deep, rather than accepting information at face value
• Keep your own biases and perceptions in check to stay as objective as possible
• Rely on your emotional intelligence to fill in the blanks and gain a more well-rounded understanding of a situation

So, critical thinking isn’t just being intelligent or analytical. In many ways, it requires you to step outside of yourself, let go of your own preconceived notions, and approach a problem or situation with curiosity and fairness.

It’s a challenge, but it’s well worth it. Critical thinking skills will help you connect ideas, make reasonable decisions, and solve complex problems.

7 critical thinking skills to help you dig deeper

Critical thinking is often labeled as a skill itself (you’ll see it bulleted as a desired trait in a variety of job descriptions). But it’s better to think of critical thinking less as a distinct skill and more as a collection or category of skills. 

To think critically, you’ll need to tap into a bunch of your other soft skills. Here are seven of the most important. 

Open-mindedness

It’s important to kick off the critical thinking process with the idea that anything is possible. The more you’re able to set aside your own suspicions, beliefs, and agenda, the better prepared you are to approach the situation with the level of inquisitiveness you need. 

That means not closing yourself off to any possibilities and allowing yourself the space to pull on every thread – yes, even the ones that seem totally implausible.

As Christopher Dwyer, Ph.D. writes in a piece for Psychology Today , “Even if an idea appears foolish, sometimes its consideration can lead to an intelligent, critically considered conclusion.” He goes on to compare the critical thinking process to brainstorming . Sometimes the “bad” ideas are what lay the foundation for the good ones. 

Open-mindedness is challenging because it requires more effort and mental bandwidth than sticking with your own perceptions. Approaching problems or situations with true impartiality often means:

• Practicing self-regulation : Giving yourself a pause between when you feel something and when you actually react or take action.
• Challenging your own biases: Acknowledging your biases and seeking feedback are two powerful ways to get a broader understanding. 

Critical thinking example

In a team meeting, your boss mentioned that your company newsletter signups have been decreasing and she wants to figure out why.

At first, you feel offended and defensive – it feels like she’s blaming you for the dip in subscribers. You recognize and rationalize that emotion before thinking about potential causes. You have a hunch about what’s happening, but you will explore all possibilities and contributions from your team members.

Observation

Observation is, of course, your ability to notice and process the details all around you (even the subtle or seemingly inconsequential ones). Critical thinking demands that you’re flexible and willing to go beyond surface-level information, and solid observation skills help you do that.

Your observations help you pick up on clues from a variety of sources and experiences, all of which help you draw a final conclusion. After all, sometimes it’s the most minuscule realization that leads you to the strongest conclusion.

Over the next week or so, you keep a close eye on your company’s website and newsletter analytics to see if numbers are in fact declining or if your boss’s concerns were just a fluke. 

Critical thinking hinges on objectivity. And, to be objective, you need to base your judgments on the facts – which you collect through research. You’ll lean on your research skills to gather as much information as possible that’s relevant to your problem or situation. 

Keep in mind that this isn’t just about the quantity of information – quality matters too. You want to find data and details from a variety of trusted sources to drill past the surface and build a deeper understanding of what’s happening. 

You dig into your email and website analytics to identify trends in bounce rates, time on page, conversions, and more. You also review recent newsletters and email promotions to understand what customers have received, look through current customer feedback, and connect with your customer support team to learn what they’re hearing in their conversations with customers.

The critical thinking process is sort of like a treasure hunt – you’ll find some nuggets that are fundamental for your final conclusion and some that might be interesting but aren’t pertinent to the problem at hand.

That’s why you need analytical skills. They’re what help you separate the wheat from the chaff, prioritize information, identify trends or themes, and draw conclusions based on the most relevant and influential facts. 

It’s easy to confuse analytical thinking with critical thinking itself, and it’s true there is a lot of overlap between the two. But analytical thinking is just a piece of critical thinking. It focuses strictly on the facts and data, while critical thinking incorporates other factors like emotions, opinions, and experiences. 

As you analyze your research, you notice that one specific webpage has contributed to a significant decline in newsletter signups. While all of the other sources have stayed fairly steady with regard to conversions, that one has sharply decreased.

You decide to move on from your other hypotheses about newsletter quality and dig deeper into the analytics. 

One of the traps of critical thinking is that it’s easy to feel like you’re never done. There’s always more information you could collect and more rabbit holes you could fall down.

But at some point, you need to accept that you’ve done your due diligence and make a decision about how to move forward. That’s where inference comes in. It’s your ability to look at the evidence and facts available to you and draw an informed conclusion based on those. 

When you’re so focused on staying objective and pursuing all possibilities, inference can feel like the antithesis of critical thinking. But ultimately, it’s your inference skills that allow you to move out of the thinking process and onto the action steps. 

You dig deeper into the analytics for the page that hasn’t been converting and notice that the sharp drop-off happened around the same time you switched email providers.

After looking more into the backend, you realize that the signup form on that page isn’t correctly connected to your newsletter platform. It seems like anybody who has signed up on that page hasn’t been fed to your email list. 

Communication

3 ways to improve your communication skills at work

If and when you identify a solution or answer, you can’t keep it close to the vest. You’ll need to use your communication skills to share your findings with the relevant stakeholders – like your boss, team members, or anybody who needs to be involved in the next steps.

Your analysis skills will come in handy here too, as they’ll help you determine what information other people need to know so you can avoid bogging them down with unnecessary details. 

In your next team meeting, you pull up the analytics and show your team the sharp drop-off as well as the missing connection between that page and your email platform. You ask the web team to reinstall and double-check that connection and you also ask a member of the marketing team to draft an apology email to the subscribers who were missed. 

Problem-solving

Critical thinking and problem-solving are two more terms that are frequently confused. After all, when you think critically, you’re often doing so with the objective of solving a problem.

The best way to understand how problem-solving and critical thinking differ is to think of problem-solving as much more narrow. You’re focused on finding a solution.

In contrast, you can use critical thinking for a variety of use cases beyond solving a problem – like answering questions or identifying opportunities for improvement. Even so, within the critical thinking process, you’ll flex your problem-solving skills when it comes time to take action. 

Once the fix is implemented, you monitor the analytics to see if subscribers continue to increase. If not (or if they increase at a slower rate than you anticipated), you’ll roll out some other tests like changing the CTA language or the placement of the subscribe form on the page.

5 ways to improve your critical thinking skills

Beyond the buzzwords: Why interpersonal skills matter at work

Think critically about critical thinking and you’ll quickly realize that it’s not as instinctive as you’d like it to be. Fortunately, your critical thinking skills are learned competencies and not inherent gifts – and that means you can improve them. Here’s how:

• Practice active listening: Active listening helps you process and understand what other people share. That’s crucial as you aim to be open-minded and inquisitive.
• Ask open-ended questions: If your critical thinking process involves collecting feedback and opinions from others, ask open-ended questions (meaning, questions that can’t be answered with “yes” or “no”). Doing so will give you more valuable information and also prevent your own biases from influencing people’s input.
• Scrutinize your sources: Figuring out what to trust and prioritize is crucial for critical thinking. Boosting your media literacy and asking more questions will help you be more discerning about what to factor in. It’s hard to strike a balance between skepticism and open-mindedness, but approaching information with questions (rather than unquestioning trust) will help you draw better conclusions. 
• Play a game: Remember those riddles we mentioned at the beginning? As trivial as they might seem, games and exercises like those can help you boost your critical thinking skills. There are plenty of critical thinking exercises you can do individually or as a team . 
• Give yourself time: Research shows that rushed decisions are often regrettable ones. That’s likely because critical thinking takes time – you can’t do it under the wire. So, for big decisions or hairy problems, give yourself enough time and breathing room to work through the process. It’s hard enough to think critically without a countdown ticking in your brain. 

Critical thinking really is critical

The ability to think critically is important, but it doesn’t come naturally to most of us. It’s just easier to stick with biases, assumptions, and surface-level information. 

But that route often leads you to rash judgments, shaky conclusions, and disappointing decisions. So here’s a conclusion we can draw without any more noodling: Even if it is more demanding on your mental resources, critical thinking is well worth the effort.

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Article • 8 min read

Critical Thinking

Developing the right mindset and skills.

By the Mind Tools Content Team

We make hundreds of decisions every day and, whether we realize it or not, we're all critical thinkers.

We use critical thinking each time we weigh up our options, prioritize our responsibilities, or think about the likely effects of our actions. It's a crucial skill that helps us to cut out misinformation and make wise decisions. The trouble is, we're not always very good at it!

In this article, we'll explore the key skills that you need to develop your critical thinking skills, and how to adopt a critical thinking mindset, so that you can make well-informed decisions.

What Is Critical Thinking?

Critical thinking is the discipline of rigorously and skillfully using information, experience, observation, and reasoning to guide your decisions, actions, and beliefs. You'll need to actively question every step of your thinking process to do it well.

Collecting, analyzing and evaluating information is an important skill in life, and a highly valued asset in the workplace. People who score highly in critical thinking assessments are also rated by their managers as having good problem-solving skills, creativity, strong decision-making skills, and good overall performance. [1]

Key Critical Thinking Skills

Critical thinkers possess a set of key characteristics which help them to question information and their own thinking. Focus on the following areas to develop your critical thinking skills:

Being willing and able to explore alternative approaches and experimental ideas is crucial. Can you think through "what if" scenarios, create plausible options, and test out your theories? If not, you'll tend to write off ideas and options too soon, so you may miss the best answer to your situation.

To nurture your curiosity, stay up to date with facts and trends. You'll overlook important information if you allow yourself to become "blinkered," so always be open to new information.

But don't stop there! Look for opposing views or evidence to challenge your information, and seek clarification when things are unclear. This will help you to reassess your beliefs and make a well-informed decision later. Read our article, Opening Closed Minds , for more ways to stay receptive.

Logical Thinking

You must be skilled at reasoning and extending logic to come up with plausible options or outcomes.

It's also important to emphasize logic over emotion. Emotion can be motivating but it can also lead you to take hasty and unwise action, so control your emotions and be cautious in your judgments. Know when a conclusion is "fact" and when it is not. "Could-be-true" conclusions are based on assumptions and must be tested further. Read our article, Logical Fallacies , for help with this.

Use creative problem solving to balance cold logic. By thinking outside of the box you can identify new possible outcomes by using pieces of information that you already have.

Self-Awareness

Many of the decisions we make in life are subtly informed by our values and beliefs. These influences are called cognitive biases and it can be difficult to identify them in ourselves because they're often subconscious.

Practicing self-awareness will allow you to reflect on the beliefs you have and the choices you make. You'll then be better equipped to challenge your own thinking and make improved, unbiased decisions.

One particularly useful tool for critical thinking is the Ladder of Inference . It allows you to test and validate your thinking process, rather than jumping to poorly supported conclusions.

Developing a Critical Thinking Mindset

Combine the above skills with the right mindset so that you can make better decisions and adopt more effective courses of action. You can develop your critical thinking mindset by following this process:

Gather Information

First, collect data, opinions and facts on the issue that you need to solve. Draw on what you already know, and turn to new sources of information to help inform your understanding. Consider what gaps there are in your knowledge and seek to fill them. And look for information that challenges your assumptions and beliefs.

Be sure to verify the authority and authenticity of your sources. Not everything you read is true! Use this checklist to ensure that your information is valid:

• Are your information sources trustworthy ? (For example, well-respected authors, trusted colleagues or peers, recognized industry publications, websites, blogs, etc.)
• Is the information you have gathered up to date ?
• Has the information received any direct criticism ?
• Does the information have any errors or inaccuracies ?
• Is there any evidence to support or corroborate the information you have gathered?
• Is the information you have gathered subjective or biased in any way? (For example, is it based on opinion, rather than fact? Is any of the information you have gathered designed to promote a particular service or organization?)

If any information appears to be irrelevant or invalid, don't include it in your decision making. But don't omit information just because you disagree with it, or your final decision will be flawed and bias.

Now observe the information you have gathered, and interpret it. What are the key findings and main takeaways? What does the evidence point to? Start to build one or two possible arguments based on what you have found.

You'll need to look for the details within the mass of information, so use your powers of observation to identify any patterns or similarities. You can then analyze and extend these trends to make sensible predictions about the future.

To help you to sift through the multiple ideas and theories, it can be useful to group and order items according to their characteristics. From here, you can compare and contrast the different items. And once you've determined how similar or different things are from one another, Paired Comparison Analysis can help you to analyze them.

The final step involves challenging the information and rationalizing its arguments.

Apply the laws of reason (induction, deduction, analogy) to judge an argument and determine its merits. To do this, it's essential that you can determine the significance and validity of an argument to put it in the correct perspective. Take a look at our article, Rational Thinking , for more information about how to do this.

Once you have considered all of the arguments and options rationally, you can finally make an informed decision.

Afterward, take time to reflect on what you have learned and what you found challenging. Step back from the detail of your decision or problem, and look at the bigger picture. Record what you've learned from your observations and experience.

Critical thinking involves rigorously and skilfully using information, experience, observation, and reasoning to guide your decisions, actions and beliefs. It's a useful skill in the workplace and in life.

You'll need to be curious and creative to explore alternative possibilities, but rational to apply logic, and self-aware to identify when your beliefs could affect your decisions or actions.

You can demonstrate a high level of critical thinking by validating your information, analyzing its meaning, and finally evaluating the argument.

Critical Thinking Infographic

See Critical Thinking represented in our infographic: An Elementary Guide to Critical Thinking .

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Critical Thinking and Decision-Making  - What is Critical Thinking?

Critical thinking and decision-making  -, what is critical thinking, critical thinking and decision-making what is critical thinking.

Critical Thinking and Decision-Making: What is Critical Thinking?

Lesson 1: what is critical thinking, what is critical thinking.

Critical thinking is a term that gets thrown around a lot. You've probably heard it used often throughout the years whether it was in school, at work, or in everyday conversation. But when you stop to think about it, what exactly is critical thinking and how do you do it ?

Watch the video below to learn more about critical thinking.

Simply put, critical thinking is the act of deliberately analyzing information so that you can make better judgements and decisions . It involves using things like logic, reasoning, and creativity, to draw conclusions and generally understand things better.

This may sound like a pretty broad definition, and that's because critical thinking is a broad skill that can be applied to so many different situations. You can use it to prepare for a job interview, manage your time better, make decisions about purchasing things, and so much more.

The process

As humans, we are constantly thinking . It's something we can't turn off. But not all of it is critical thinking. No one thinks critically 100% of the time... that would be pretty exhausting! Instead, it's an intentional process , something that we consciously use when we're presented with difficult problems or important decisions.

Improving your critical thinking

In order to become a better critical thinker, it's important to ask questions when you're presented with a problem or decision, before jumping to any conclusions. You can start with simple ones like What do I currently know? and How do I know this? These can help to give you a better idea of what you're working with and, in some cases, simplify more complex issues.  

Real-world applications

Let's take a look at how we can use critical thinking to evaluate online information . Say a friend of yours posts a news article on social media and you're drawn to its headline. If you were to use your everyday automatic thinking, you might accept it as fact and move on. But if you were thinking critically, you would first analyze the available information and ask some questions :

• What's the source of this article?
• Is the headline potentially misleading?
• What are my friend's general beliefs?
• Do their beliefs inform why they might have shared this?

After analyzing all of this information, you can draw a conclusion about whether or not you think the article is trustworthy.

Critical thinking has a wide range of real-world applications . It can help you to make better decisions, become more hireable, and generally better understand the world around you.

/en/problem-solving-and-decision-making/why-is-it-so-hard-to-make-decisions/content/

The Path to Critical Thinking

by Stever Robbins

Can you write a refresher on critical thinking?

What's logic got to do with it? Nothing! We don't use logic to decide, or even to think. And a good thing, too, or the advertising industry would be dead in the water. Unfortunately, all of our decisions come from emotion. Emotional Intelligence guru Daniel Goleman explains that our brain's decision-making center is directly connected to emotions, then to logic. So, as any good salesman will tell you, we decide with emotion and justify (read: fool ourselves) with logic.

Purely emotional decision making is bad news. When insecurity, ego, and panic drive decisions, companies become toxic and may even die. Just look at all the corporate meltdowns over the last five years to quickly understand where emotional decision making can lead.

Critical thinking starts with logic. Logic is the unnatural act of knowing which facts you're putting together to reach your conclusions, and how. We're hard-wired to assume that if two things happen together, one causes the other. This lets us leap quickly to very wrong conclusions. Early studies showed that increasing light levels in factories increased productivity. Therefore, more light means more productivity? Wrong! The workers knew a study was being done, and they responded to any change by working harder, since they knew they were being measured—the Hawthorne Effect.

We also sloppily reverse cause and effect. We notice all our high performers have coffee at mid-morning, and conclude that coffee causes high performance. Maybe. Maybe not. Maybe high performers work so late and are so sleep deprived that they need coffee to wake up. Unless you want a hyper-wired workforce, it's worth figuring out what really causes what.

There are many excellent books on logic. One of my favorites is the most-excellent and most-expensive Minto Pyramid Principle by Barbara Minto. It's about logic in writing, but you can use it for any decision you want to think through in detail.

The trap of assuming You can think critically without knowing where the facts stop and your own neurotic assumptions begin. We aren't built to identify our own assumptions without lots of practice, yet the wrong assumptions are fatal.

When we don't know something, we assume. That's a fancy way of saying, "we make stuff up." And often, we don't realize we're doing it. When our best performers leave, our first (and perhaps only) response is to offer them more pay, without realizing that other motivations like job satisfaction or recognition for accomplishments might be more important.

Finding and busting "conventional wisdom" can be the key to an empire. For decades, the standard video rental store model assumed that people wanted instant gratification and, to get it, they were willing to drive to a store, pay a rental fee for a few days' access, and then drive back to the store in a few days to return the movie. Thousands of big and small video rental parlors popped up across the country using this model. But Reed Hastings challenged those assumptions. He calculated that people would trade instant gratification for delayed, and would pay a monthly fee if they could have movies mailed to them, which they could keep as long as they liked. The result? Netflix. Estimated 2005 revenue: $700 million.

Assumptions can also cripple us. A CEO confided that he never hires someone who backs into a parking space. His logic (and I use the term loosely): The person will use time at the start of the day so they can leave more quickly at the end of the day. He assumes face time equals results. In whose world? Many people tell me they get more done in an hour at home than in eight hours in an interruption-prone office. How many great employees will he miss because he's not examining his assumptions?

Some assumptions run so deep they're hard to question. Many managers can't imagine letting people work fewer hours for the same pay. "If they go home earlier, we have to pay them less." Why? "Hours = productivity" is true of assembly lines, but not knowledge work. Research shows that it's not how much you work, but the quality of the work time that drives results. 2 But in most workplaces, hours count as much as results.

Next time you're grappling with a problem, spend time brainstorming your assumptions. Get others involved—it's easier to uncover assumptions with an outside perspective. Then question the heck out of each one. You may find that one changed assumption is the difference between doing good and doing great.

The truth will set you free (statistics notwithstanding) Have you ever noticed how terrified we are of the truth? We're desperately afraid that the truth will reveal us as incompetent. Our situation really is hopeless. We really aren't as great as we pretend. So we cling to our beliefs no matter how hard the truth tries to break free.

Guess what, recording industry: Electronic downloads have changed the nature of your business. Start asking how you'll add value in a world where finding, packaging, and distributing sound is a commodity. Hey, ailing airlines: Oil's expensive, customers won't pay much, and you have huge capital costs. That hasn't stopped Southwest, Jet Blue, and others from making a fortune.

Nothing tells the truth like solid data and the guts to accept it. But it's difficult in practice. When was the last time you identified and collected data that contradicted your beliefs? If you found it, did you cheerfully change your belief, or did you explain away the data in a way that let you keep your comfortable pre-conceptions?

Here is a great exercise for your group or company. Have your general managers list your industry's Unquestioned Truths, which they then must prove with data. When a Fortune 500 CEO recently ran this exercise, Surprise! Some "absolute truths" were absolutely false. Now he can do business his competitors think is nuts. Analysts will say he's off his rocker, until his deeper knowledge of truth starts making a small fortune.

One caveat: Be picky about where you get your data. The Internet can be especially dangerous. The miracle of technology lets one bad piece of data spread far and wide, and eventually be accepted as truth.

Help! I've been framed! Not only may your data be disguised, but the whole problem itself may be disguised! It seems obvious: we're losing money, we need to cut costs. Not so fast! How you "frame" a situation—your explanation—has great power. Remember assumptions? Frames are big ol' collections of assumptions that you adopt lock, stock, and barrel. They become the map you use to explore a situation.

You're negotiating an acquisition. You're chomping at the bit. It's WAR!! Competition is all. The frame is combat!

Or, you're negotiating an acquisition. You're on a journey with the other party to find and split the value buried at the X. You still track your gains and gather intelligence, but the emphasis is on mutual outcomes, not "winning."

In a zero-sum one-time negotiation, a combat frame may be the best tool. But in a negotiation where you're free to develop creative solutions that can involve outside factors, the journey frame could work best. "Instead of $100K, why don't you pay $75K and let us share your booth at Comdex?"

Frames have great power! Presented with a potential solution to a problem and told, "This course of action has a 20 percent failure rate," few managers would approve. When that same solution is presented as having an 80 percent success rate, the same manager is going to consider it more deeply— even though a 20 percent failure rate means the same thing as an 80 percent success rate! The frame changes the decision.

Are you brave in the face of failure? Most people aren't. I recommend the responsibility frame: "What aren't we doing what we should?" The responsibility frame sends you searching for the elements of success.

The beauty is that no one frame is right, just different. The danger is when we adopt a frame without questioning it. You'll do best by trying several different frames for a situation and exploring each to extract the gems.

People are our greatest asset. Really Critical thinking isn't just about what happens in our own brains. When you're thinking critically in business, bring in other people! We don't consider the people impact in our decisions often enough. In fact, we pooh-pooh the "soft stuff." We feel safe with factors we can calculate on our HP-12B. But in truth, business is about people. Multibillion-dollar mergers fail due to culture clash.

Customers, suppliers, partners, employees. They're as much a part of your business as that sparkly new PC you use to play Solitaire. How will your decisions change their lives? Imagine being them and let your imagination change your decisions.

The Gallup organization estimates that 70 percent of America's workers are disengaged, and disengaged workers are dramatically less productive, creative, and committed than engaged workers. Yet few strategy meetings ask, "How can we engage our employees more?" It's as if we say people are our greatest asset—but we don't really believe it. If you want to improve your critical thinking, get other points of view.

A stitch in time saves nine Of course you know you should think about the consequences of your actions. But with information overload, quarterly earnings pressure, sixty-hour weeks…who has the time? We don't think much beyond the end of our nose.

But technology leverages the effects of our decisions throughout the organization and even across the globe. So good thinking demands that you consider consequences over many timeframes. Think out a month, a year, a decade, many decades. That tanning booth looks great when you consider how you'll look in a week, but is it worth looking like a leather overcoat ten years from now?

Long-term junkies like me are great at creating ten-year plans, but managing next month's cash flow? Not likely. Short-term junkies are more common; they're the ones who discount to make this quarter's numbers, while tanking the company in the process. You can do better by considering multiple timeframes.

I could go on, but there's plenty here to chew on. Think about a decision you're making, and pull in the rigor:

• Make sure you understand the logic behind your decision.
• Identify your assumptions and double-check them.
• Collect the data that will support or disprove your assumptions.
• Deliberately consider the situation from multiple frames.
• Remember the people!
• Think short and long term.

© 2005 by Stever Robbins. All rights reserved in all media.

Stever Robbins is founder and president of LeadershipDecisionworks, a consulting firm that helps companies develop leadership and organizational strategies to sustain growth and productivity over time. You can find more of his articles at http://LeadershipDecisionworks.com . He is the author of It Takes a Lot More than Attitude to Lead a Stellar Organization .

1. Yes, I know. I'm making a point. Congratulations; you got it. Color me subtle. Now go back and keep reading...

2. The Power of Full Engagement , by Tony Schwartz and Jim Loehr, New York: Simon & Schuster, 2003.

Critical Thinking for Managers

Structured Decision-Making and Persuasion in Business

• © 2021
• Radu Atanasiu   ORCID: https://orcid.org/0000-0001-8850-9538 0

Bucharest International School of Management, Bucharest, Romania

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• Offers a structured approach and easy-to-use tools for improving decision-making in business
• Presents tested methods to cope with disagreement and to learn from failure
• Structures the persuasion process by highlighting the correct mix of arguments and empathy
• Discusses critical thinking as tool for humane leadership

Part of the book series: Management for Professionals (MANAGPROF)

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About this book

This book discusses critical thinking as a tool for more compassionate leadership, presenting tried and tested methods for managing disagreement, for anticipating and solving problems, and for enhancing empathy. Employing a lighter tone of voice than most management books, it also shows how and when less-than-rational mechanisms such as intuition and heuristics may be efficient decision-making tools in any manager’s toolbox.  

Critical thinking is useful for analyzing incoming information in the context of decision-making and is crucial for structuring outgoing information in the context of persuasion. When trying to convince a client to buy a service, an executive board to fund a project, or a colleague to change a procedure, managers can use the simple step-by-step guides provided here to prepare for successful meetings and effective pitches.

Managerial thinking can be steadily improved, using a structured process, especially if we learn to think about our thinking. This book guides current and would-be managers through this process of improving and metathinking, in connection with decision-making and persuasion. Using examples from business, together with research insights from Behavioral Economics and from Management and Organizational Cognition, the author illustrates common pitfalls like hidden assumptions and cognitive biases, and provides easy-to-use solutions for testing hypotheses and resolving dilemmas. 

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Table of contents (15 chapters)

Front matter, introduction.

Radu Atanasiu

Who Needs Critical Thinking?

Critical thinking in business decision-making, hidden assumptions, test your business assumptions, reason, emotions, intuition, cognitive biases, decisions, decisions, decisions, decision-making in groups, problem solving, critical thinking in persuasion, one-on-one persuasion, ten fair-play principles in argumentation, the courage to change our mind.

“It is a how-to guide on critical thinking for managers. Although it is a very serious subject it is written in a pleasant, engaging and easy-to-read style and is larded with some fun, enlightening and sometimes challenging intermezzos. The book has a certain focus on decision making and pursuasion as the subtitle discloses and it is a very efficient pick from the vast world of critical thinking for practical use by managers.” (Paul Hartog, goodreads.com, July 15, 2021)

Authors and Affiliations

About the author, bibliographic information.

Book Title : Critical Thinking for Managers

Book Subtitle : Structured Decision-Making and Persuasion in Business

Authors : Radu Atanasiu

Series Title : Management for Professionals

DOI : https://doi.org/10.1007/978-3-030-73600-2

Publisher : Springer Cham

eBook Packages : Business and Management , Business and Management (R0)

Copyright Information : Springer Nature Switzerland AG 2021

Hardcover ISBN : 978-3-030-73599-9 Published: 11 May 2021

eBook ISBN : 978-3-030-73600-2 Published: 10 May 2021

Series ISSN : 2192-8096

Series E-ISSN : 2192-810X

Edition Number : 1

Number of Pages : VII, 186

Number of Illustrations : 1 b/w illustrations, 16 illustrations in colour

Topics : Human Resource Development , Management , Industrial and Organizational Psychology , Economic Psychology

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Critical Thinking Is About Asking Better Questions

• John Coleman

Six practices to sharpen your inquiry.

Critical thinking is the ability to analyze and effectively break down an issue in order to make a decision or find a solution. At the heart of critical thinking is the ability to formulate deep, different, and effective questions. For effective questioning, start by holding your hypotheses loosely. Be willing to fundamentally reconsider your initial conclusions — and do so without defensiveness. Second, listen more than you talk through active listening. Third, leave your queries open-ended, and avoid yes-or-no questions. Fourth, consider the counterintuitive to avoid falling into groupthink. Fifth, take the time to stew in a problem, rather than making decisions unnecessarily quickly. Last, ask thoughtful, even difficult, follow-ups.

Are you tackling a new and difficult problem at work? Recently promoted and trying to both understand your new role and bring a fresh perspective? Or are you new to the workforce and seeking ways to meaningfully contribute alongside your more experienced colleagues? If so, critical thinking — the ability to analyze and effectively break down an issue in order to make a decision or find a solution — will be core to your success. And at the heart of critical thinking is the ability to formulate deep, different, and effective questions.

• JC John Coleman is the author of the HBR Guide to Crafting Your Purpose . Subscribe to his free newsletter, On Purpose , follow him on Twitter @johnwcoleman, or contact him at johnwilliamcoleman.com.

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Effective Decision Making: Thinking Critically and Rationally

Program overview.

Emphasizing the importance of long-term strategic decision making, Effective Decision Making: Thinking Critically and Rationally is designed to improve managers’ judgment and critical thinking skills using proven approaches, cutting-edge research, and behavioral economics.

Participants will understand the decision-making process from start to finish, with the ability to recognize cognitive biases that inhibit good decisions. This strategic decision-making program enhances participants' capacity to make well-thought-out individual, group, and organizational decisions.

Date, Location, & Fees

If you are unable to access the application form, please email Client Relations at [email protected] .

November 11 – 15, 2024 Philadelphia, PA $12,500

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Who should attend, testimonials, highlights and key outcomes.

In Effective Decision Making: Thinking Critically and Rationally , you will learn how to:

• Make decisions in a dynamic of uncertainty
• Build adaptability into your decisions
• Provide the leadership to mitigate the effects of cognitive biases
• Understand the role of emotions and ethics in decision making
• Develop tools to improve individual and organizational decision making

Experience & Impact

In an uncertain business environment, a major challenge is being a decisive, strategic leader. Effective Decision Making: Thinking Critically and Rationally is designed to improve your judgment and guide you to think rigorously and critically.

Wharton faculty, led by Professor Maurice Schweitzer, apply their field-based research and the latest strategic insights to help you broaden your perspective on how to influence, persuade, and make informed, strategic decisions without bias. You will be exposed to new tools and actionable knowledge that will make an immediate impact on how you lead your organization.

Session topics include:

• Rule-Based Decision Making
• Combining Opinions
• Thinking Ethically
• Judgment and Decision Making: The Logic of Chance
• Trust and Cooperation
• Power of Negative Thinking
• Decision Hygiene
• The Role of Data in Decision Making
• Group Decision Making

Through highly interactive lectures, exercises, and case studies, both in the classroom and in smaller work groups, this deep dive into the art and science of decision making will enhance your effectiveness as a leader.

Convince Your Supervisor

Here’s a justification letter you can edit and send to your supervisor to help you make the case for attending this Wharton program.

Due to our application review period, applications submitted after 12:00 p.m. ET on Friday for programs beginning the following Monday may not be processed in time to grant admission. Applicants will be contacted by a member of our Client Relations Team to discuss options for future programs and dates.

Effective Decision Making: Thinking Critically and Rationally is designed for executives who are moving from tactical to strategic roles and for those involved in cross-functional decisions. It is of particular benefit to organizations and industries whose decision-making approaches are shifting as a result of high levels of uncertainty, including telecommunications, financial services, and health care.

Participants leave the program with an expanded peer network, plus specific tools and frameworks they can use to enhance how they approach decisions across their organization.

Fluency in English, written and spoken, is required for participation in Wharton Executive Education programs unless otherwise indicated.

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Participants by Industry

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This program is held at the Steinberg Conference Center located on the University of Pennsylvania campus in Philadelphia. Meals and accommodations are included in the program fees. Learn more about planning your stay at Wharton’s Philadelphia campus .

Group Enrollment

To further leverage the value and impact of this program, we encourage companies to send cross-functional teams of executives to Wharton. We offer group-enrollment benefits to companies sending four or more participants.

Maurice Schweitzer, PhD See Faculty Bio

Academic Director

Cecilia Yen Koo Professor; Professor of Operations, Information and Decisions; Professor of Management, The Wharton School

Research Interests: Decision making, deception and trust, negotiations

Thomas Donaldson, PhD See Faculty Bio

Mark O. Winkelman Professor; Professor of Legal Studies and Business Ethics, The Wharton School

Research Interests: Business ethics, corporate compliance, corporate governance

Cade Massey, PhD See Faculty Bio

Practice Professor, Operations, Information and Decisions, The Wharton School

Research Interests: People analytics, judgment under uncertainty, organizational behavior

Joseph Simmons, PhD See Faculty Bio

Dorothy Silberberg Professor of Applied Statistics; Professor of Operations, Information and Decisions, The Wharton School

Research Interests: Judgment and decision making, experimental methods, consumer behavior

Abraham Wyner, PhD See Faculty Bio

Professor of Statistics; Director of Undergraduate Program in Statistics; Faculty Lead of the Wharton Sports Analytics and Business Initiative, The Wharton School

Research Interests: Baseball, boosting, data compression, entropy, information theory, probabilistic modeling, temperature reconstructions

Annie Duke See Faculty Bio

Speaker, Decision Strategist, and Former Professional Poker Player

Ernest D. Haynes III  VP & General Manager, Sonoco

The timing for taking Wharton’s Effective Decision Making: Thinking Critically and Rationally was ideal because I am moving from a sales leadership role with Payer & Health System customers to an enterprise role where more strategic thinking will be needed. In my new position my remit will be to support and build the commercial capabilities of the entire enterprise. I have been customer facing for most of my career and now I will be working with more of an in-building team where pulling out the best ideas and thinking from my teammates will be critical. Wharton’s coursework and faculty’s way of thinking about decision making and how to be a better strategic thinker will absolutely help me in my new role. Two insights really struck me — one was strategies for how to get the best ideas, feedback, and insights from everyone on the team and how to fine-tune the ideas that surface, and the other was the thinking around randomness and how you have to be sure you are rewarding the process — not just the outcome — because oftentimes great or bad results can be driven by multiple factors, including bias. The pharma industry faces many challenges, especially in the areas of transparency and addressing the issue of the cost of drug products to the patient. How do you find the right balance between having a profit so you can innovate but being able to bridge for patients who need to be able to afford your innovation? Whoever cracks that nut and builds that bridge between innovation, affordability, and patient access will get the keys to the kingdom. Another issue we grapple with is around accessing physicians — as an industry we essentially have the same selling model as 50 years ago. In this digital age, we have to think about how we find the right balance of face-to-face engagement as well as building other ways to inform and educate physicians in real time. Wharton teaches you how to think about how best to approach problems like these — by using the tools that I learned in this course, I believe that in my new role, my team will net better results as we seek to solve complex issues like these facing our company and our industry. Also, now I have a broader network through Wharton that will be able to support me as I grow as a leader in my organization.”

Caroline DeMarco  Vice President, Commercial Capabilities, Strategic Planning & Operations, GSK

What drew me to Wharton was its reputation and the deep selection of courses. A key takeaway for me in Effective Decision Making: Thinking Critically and Rationally was understanding the bias in qualitative information. I come from more of a quantitative background dealing with data, but as you advance through your career, the qualitative aspect of decision making becomes more important — the soft skills and our ability to use qualitative information to make effective decisions. When it comes to strategic decision making, there are no absolutes — you frequently have to make decisions without 100 percent of the information. This class really gives you pause to consider the implications of decisions, knowing that you don’t have 100 percent of the information. This has direct relevance to my role in risk management because we don’t deal with anything that is black and white. Wharton’s insights on qualitative decision-making bias also influenced what I wrote in an article on reputation risk that will appear in the RMA Journal .”

Joseph Iraci  CRO of Regulated Entities & Managing Director of Financial Risk Management, TD Ameritrade

I am the director of the John Templeton Foundation’s character development portfolio. I oversee 60 grants that include research and programmatic grants focusing on advancing the science and practice of character. My greatest challenge is identifying the proposals that will yield important information about the cultivation of good character. In Effective Decision Making: Thinking Critically and Rationally we heard the latest research from experts in business, psychology, and law. These scholars are also very talented at translating that research and making it relevant to organizations independent of industry. They sparked a lot of my own thinking and ideas of ways in which we could use this research to improve the outcomes at our foundation. We like to think our decision-making processes are objective and free of bias, but bias is a part of human nature and as the workshop highlights, you will make far better, more strategic decisions if you understand what the biases are and how they influence your thinking. I came home with dozens of pages of notes for how my organization might use this latest research on strategic decision making to improve our own practices. Personally, I consider bias on a more regular basis and more intentionally, trying to build systems into my own process to mitigate the effects of these biases. Another lecture topic was on the logic of chance, which is very relevant to philanthropy. We spend a lot of time and resources trying to identify the best proposal to yield insights into character, but there is a lot of chance involved. We can’t guarantee results, but understanding the role chance plays in achieving an outcome is powerful. Wharton’s program was immediately applicable to my work. We are currently going through a strategic planning process and our foundation’s president asked the senior grant-making staff to brainstorm a number of ideas to pursue in the next round of our planning; during one of our off-site retreats, she used Wharton’s process for brainstorming. It was also great to have different perspectives in the program. We had participants from Nigeria, South Korea, and Brazil, and when the law professor shared a case study about Walmart and their practices abroad in the context of ethical decision making — specifically around the issue of bribery — it was fascinating to hear from individuals who do a lot of work abroad who could provide greater context. To conclude, this was an outstanding program, which would be valuable for any executive in any field. It’s about better thinking — becoming more cognizant of how to make better decisions.”

Sarah Clement  Director of Character Virtue Development, John Templeton Foundation

I decided to attend the Effective Decision Making: Thinking Critically and Rationally program at Wharton to help me make even more effective decisions. As a result of my attending, I was able to broaden my strategic-thinking perspective based on insights from their highly impressive team of professors and colleagues who attended from a diverse range of functions, industries, and countries. There were several key takeaways that I have been able to leverage in my day-to-day work responsibilities, including the following: You cannot judge the quality of individual decisions based on their outcomes; instead, the quality should be judged on the process that was used to make them People tend to be overly precise while they should consider a much larger range of possibilities Even dramatically different outcomes can be purely the product of chance My overall experience exceeded my expectations. I plan on keeping in touch with a few of the colleagues whom I met and I certainly expect to find my way back to Wharton!”

Jonathan Hirschmann  Animal Health Executive

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Global Cognition

Critical thinking in decision making.

by Winston Sieck updated September 12, 2021

Critical thinking is often talked about as a stand-alone activity. Like some other individual activities, thinking critically may just feel good. Yet, critical thinking seems most useful when it aids other cognitive processes, such as applying critical thinking in decision making.

Anne Helsdingen from the Open University of the Netherlands and her colleagues studied an interesting issue about critical thinking in decision making. They wanted to know whether teaching critical thinking skills can improve judgment and decision making in general.

Helsdingen and her team define critical thinking as reasoned thinking with a purpose. They also describe some core critical thinking skills and abilities, such as being able to:

• Appreciate that your own opinions may be wrong
• Accept statements as true even when they conflict with your own views
• Temporarily adopt an initial position with which you disagree, and then reason from that starting point

A challenge, according to these researchers, is how to teach skills for critical thinking in decision making so that they transfer to new decision making problems. Transfer means being able to apply what you have learned to new tasks or new situations.

To tackle this problem, they start with a useful cognitive model of how decisions are made . Numerous researchers have worked with similar versions of the model of the years. One version is called “explanation-based decision making,” or the “story model.”

The idea is that people encounter situations. When they do, they recognize important parts of the situation from past experience. They then create a story (or explanation) about what’s going on and what will happen. They make decisions based on their story, and how things have turned out in similar stories past.

A problem with making decisions this way is that our stories tend to be less complete than we think – a failure of metacognition. We also overlook inconsistent details because we’re sucked in by the good story. According to Helsdingen, we might improve our intuitive approach by bringing critical thinking in the decision making process.

The researchers tested a method for including critical thinking in decision making. First, they explained the story model of decision making. Then, they prompted the learners to reflect on their story and thinking critically about it. Some of the questions they included to prompt critical thinking were:

• Do you have all the necessary information?
• Is there any conflict in the evidence?
• The devil’s advocate tells you that your story is wrong. Make up an alternative story. Is it more plausible than the original?

The students in the study read through cases about crimes that had been committed. Their job was to decide on the priority of each case for the police. They got feedback, so they could learn what makes cases more important in police work.

Some of the students received the critical thinking skills training while making these decisions. Others did not.

How well they made these crime decisions was not the most important thing, though. The main thing was how well they would do in a different situation after learning about critical thinking in decision making. That is, would their new skills transfer?

The researchers tested for transfer by having the students make different decisions about traffic offenses. The overall results suggested that the training on how to include critical thinking in decision making was effective. The benefits did transfer to the new decision making task.

As you come across decisions that you need to make, pay some attention to the stories you are telling yourself in the process. Use some of the ideas above and other critical thinking skills to improve your story and decision. Writing is also an excellent strategy for making good decisions . It may seem like a bit of extra work at first, but with practice will become more natural for your future decisions.

Image Credit:  Critical thinking asylum

Helsdingen, A., van Gog, T., & van Merriënboer, J. (2011). The effects of practice schedule and critical thinking prompts on learning and transfer of a complex judgment task. Journal of Educational Psychology, 103 (2), 383-398 DOI: 10.1037/a0022370

About Winston Sieck

Dr. Winston Sieck is a cognitive psychologist working to advance the development of thinking skills. He is founder and president of Global Cognition, and director of Thinker Academy .

Reader Interactions

January 13, 2013 at 6:36 pm

Thanks for sharing this research and the ‘story’. We are often asked whether you can learn to be a better critical thinker – I wouldn’t be teaching it if I didn’t believe it to be the case! But it helps to have research to support this belief.

Our work is focused on critical thinking in organizational, workplace settings with all sorts of employees, including managers and executives. My experience is pretty similar to that you gave in the case; in the moment, on a particular case, the ‘decision’ may not be improved.

As the researchers and you point out, the proof is in the pudding. Can people learn and apply simple critical thinking techniques, consistently and effectively, and, does this lead to better outcomes?

We find that it can be overwhelming to try to teach too much at a clip. We boil it down to simple questions, job aids, and worksheets that can help people – especially people working on teams – to establish a common vocabulary, and create an environment that reinforces critical thinking rather than viewing it as generating conflict and controversy.

February 21, 2014 at 4:02 am

I am interested in teaching critical thinking skills to Law Enforcement, specifically to a group of people age 14 to 18 who are interested in pursuing a Law Enforcement Career (The Police Explorer Program) but then later to already established officers.

A law enforcement officer (LEO) is called upon to make decisions and wield power which effect others lives, and they are often required to do this on the spot, with a limited amount of time and information available. They make these decisions every day and I am looking for ways to sharpen their skills and help them make the best decisions possible with the information they have on hand.

I couldn’t help but notice that this study happened to be centered on LEO scenarios. I was wondering if I could adapt this study to a class for young people. Any thoughts?

Also, how could I get the specifics of this study, to include the specific scenarios used?

February 21, 2014 at 9:34 am

That sounds really interesting, Eric. I contacted Anne Helsdingen on your behalf, and shared your contact information with her.

February 28, 2016 at 11:40 pm

For the last five years I have taught CT to serving LEOs, although only slowly at first; it is a sharp departure from traditional police training. While new theories come out on how to fix a profession currently under enormous pressure, many of them have been around for 10 or 20 years whereas CT has been developed over at least 25 centuries. I would be happy to share my work and experiences to to hear of others’ work too.

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5.3: Using Critical Thinking Skills- Decision Making and Problem Solving

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Introduction

In previous lessons, you learned about characteristics of critical thinkers and information literacy. In this module, you will learn how to put those skills into action through the important processes of decision making and problem solving.

As with the process of developing information literacy, asking questions is an important part of decision making and problem solving. Thinking is born of questions. Questions wake us up. Questions alert us to hidden assumptions. Questions promote curiosity and create new distinctions. Questions open up options that otherwise go unexplored. Besides, teachers love questions.

We make decisions all the time, whether we realize it or not. Even avoiding decisions is a form of decision making. The student who puts off studying for a test until the last minute, for example, might really be saying, “I’ve decided this course is not important” or “I’ve decided not to give this course much time.”

Decisions are specific and lead to focused action. When we decide, we narrow down. We give up actions that are inconsistent with our decision.

In addition to decision making, critical thinking skills are important to solving problems. We encounter problems every single day, and having a solid process in place is important to solving them.

At the end of the lesson, you will learn how to put your critical thinking skills to use by reviewing an example of how critical thinking skills can help with making those everyday decisions.

Using Critical Thinking Skills: Asking Questions

Questions have practical power. Asking for directions can shave hours off a trip. Asking a librarian for help can save hours of research time. Asking how to address an instructor—by first name or formal title—can change your relationship with that person. Asking your academic advisor a question can alter your entire education. Asking people about their career plans can alter your career plans.

You can use the following strategies to develop questions for problem solving and decision making:

Ask questions that create possibilities. At any moment, you can ask a question that opens up a new possibility for someone.

• Suppose a friend walks up to you and says, “People just never listen to me.” You listen carefully. Then you say, “Let me make sure I understand. Who, specifically, doesn’t listen to you? And how do you know they’re not listening?”
• Another friend tells you, “I just lost my job to someone who has less experience. That should never happen.” You respond, “Wow, that’s hard. I’m sorry you lost your job. Who can help you find another job?”
• A relative seeks your advice. “My mother-in-law makes me mad,” she says. “You’re having a hard time with this person,” you say. “What does she say and do when you feel mad at her? And are there times when you don’t get mad at her?”

These kinds of questions—asked with compassion and a sense of timing—can help people move from complaining about problems to solving them.

Discover new questions. Students sometimes say, “I don’t know what questions to ask.” Consider the following ways to create questions about any subject you want to study or about any

area of your life that you want to change:

• Let your pen start moving. Sometimes you can access a deeper level of knowledge by taking out your pen, putting it on a piece of paper, and writing down questions—even before you know what to write. Don’t think. Just watch the pen move across the paper. Notice what appears. The results might be surprising.
• Ask about what’s missing . Another way to invent useful questions is to notice what’s missing from your life and then ask how to supply it. For example, if you want to take better notes, you can write, “What’s missing is skill in note taking. How can I gain more skill in taking notes?” If you always feel rushed, you can write, “What’s missing is time. How do I create enough time in my day to actually do the things that I say I want to do?”
• Pretend to be someone else. Another way to invent questions is first to think of someone you greatly respect. Then pretend you’re that person. Ask the questions you think she would ask.
• What can I do when ... an instructor calls on me in class and I have no idea what to say? When a teacher doesn’t show up for class on time? When I feel overwhelmed with assignments?
• How can I ... take the kind of courses that I want? Expand my career options? Become much more effective as a student, starting today?
• When do I ... decide on a major? Transfer to another school? Meet with an instructor to discuss an upcoming term paper?
• What else do I want to know about ... my academic plan? My career plan? My options for job hunting? My friends? My relatives? My spouse?
• Who can I ask about ... my career options? My major? My love life? My values and purpose in life?

Many times you can quickly generate questions by simply asking yourself, “What else do I want to know?” Ask this question immediately after you read a paragraph in a book or listen to someone speak.

Start from the assumption that you are brilliant. Then ask questions to unlock your brilliance.

Using Critical Thinking Skills in Decision Making

As you develop your critical thinking skills, you can apply them as you make decisions. The following suggestions can help in your decision-making process:

Recognize decisions. Decisions are more than wishes or desires. There’s a world of difference between “I wish I could be a better student” and “I will take more powerful notes, read with greater retention, and review my class notes daily.” Deciding to eat fruit for dessert instead of ice cream rules out the next trip to the ice cream store.

Establish priorities. Some decisions are trivial. No matter what the outcome, your life is not affected much. Other decisions can shape your circumstances for years. Devote more time and energy to the decisions with big outcomes.

Base decisions on a life plan. The benefit of having long-term goals for our lives is that they provide a basis for many of our daily decisions. Being certain about what we want to accomplish this year and this month makes today’s choices more clear.

Balance learning styles in decision making. To make decisions more effectively, use all four modes of learning explained in a previous lesson. The key is to balance reflection with action, and thinking with experience. First, take the time to think creatively, and generate many options. Then think critically about the possible consequences of each option before choosing one. Remember, however, that thinking is no substitute for experience. Act on your chosen option, and notice what happens. If you’re not getting the results you want, then quickly return to creative thinking to invent new options.

Choose an overall strategy. Every time you make a decision, you choose a strategy—even when you’re not aware of it. Effective decision makers can articulate and choose from among several strategies. For example:

• Find all of the available options, and choose one deliberately. Save this strategy for times when you have a relatively small number of options, each of which leads to noticeably different results.
• Find all of the available options, and choose one randomly. This strategy can be risky. Save it for times when your options are basically similar and fairness is the main issue.
• Limit the options, and then choose. When deciding which search engine to use, visit many search sites and then narrow the list down to two or three from which to choose.

Use time as an ally. Sometimes we face dilemmas—situations in which any course of action leads to undesirable consequences. In such cases, consider putting a decision on hold. Wait it out. Do nothing until the circumstances change, making one alternative clearly preferable to another.

Use intuition. Some decisions seem to make themselves. A solution pops into your mind, and you gain newfound clarity. Using intuition is not the same as forgetting about the decision or refusing to make it. Intuitive decisions usually arrive after we’ve gathered the relevant facts and faced a problem for some time.

Evaluate your decision. Hindsight is a source of insight. After you act on a decision, observe the consequences over time. Reflect on how well your decision worked and what you might have done differently.

Think of choices. This final suggestion involves some creative thinking. Consider that the word decide derives from the same roots as suicide and homicide . In the spirit of those words, a decision forever “kills” all other options. That’s kind of heavy. Instead, use the word choice , and see whether it frees up your thinking. When you choose , you express a preference for one option over others. However, those options remain live possibilities for the future. Choose for today, knowing that as you gain more wisdom and experience, you can choose again.

Using Critical Thinking Skills in Problem Solving

Think of problem solving as a process with four Ps : Define the problem , generate possibilities ,

create a plan , and perform your plan.

Step 1: Define the problem. To define a problem effectively, understand what a problem is—a mismatch between what you want and what you have. Problem solving is all about reducing the gap between these two factors.

Tell the truth about what’s present in your life right now, without shame or blame. For example: “I often get sleepy while reading my physics assignments, and after closing the book I cannot remember what I just read.”

Next, describe in detail what you want. Go for specifics: “I want to remain alert as I read about physics. I also want to accurately summarize each chapter I read.”

Remember that when we define a problem in limiting ways, our solutions merely generate new problems. As Albert Einstein said, “The world we have made is a result of the level of thinking we have done thus far. We cannot solve problems at the same level at which we created them” (Calaprice 2000).

This idea has many applications for success in school. An example is the student who struggles with note taking. The problem, she thinks, is that her notes are too sketchy. The logical solution, she decides, is to take more notes; her new goal is to write down almost everything her instructors say. No matter how fast and furiously she writes, she cannot capture all of the instructors’ comments.

Consider what happens when this student defines the problem in a new way. After more thought, she decides that her dilemma is not the quantity of her notes but their quality . She adopts a new format for taking notes, dividing her notepaper into two columns. In the right-hand column, she writes down only the main points of each lecture. In the left-hand column, she notes two or three supporting details for each point.

Over time, this student makes the joyous discovery that there are usually just three or four core ideas to remember from each lecture. She originally thought the solution was to take more notes. What really worked was taking notes in a new way.

Step 2: Generate possibilities. Now put on your creative thinking hat. Open up. Brainstorm as many possible solutions to the problem as you can. At this stage, quantity counts. As you generate possibilities, gather relevant facts. For example, when you’re faced with a dilemma about what courses to take next semester, get information on class times, locations, and instructors. If you haven’t decided which summer job offer to accept, gather information on salary, benefits, and working conditions.

Step 3: Create a plan. After rereading your problem definition and list of possible solutions, choose the solution that seems most workable. Think about specific actions that will reduce the gap between what you have and what you want. Visualize the steps you will take to make this solution a reality, and arrange them in chronological order. To make your plan even more powerful, put it in writing.

Step 4: Perform your plan. This step gets you off your chair and out into the world. Now you actually do what you have planned.

Ultimately, your skill in solving problems lies in how well you perform your plan. Through the quality of your actions, you become the architect of your own success.

When facing problems, experiment with these four Ps, and remember that the order of steps is not absolute. Also remember that any solution has the potential to create new problems. If that happens, cycle through the four Ps of problem solving again.

Critical Thinking Skills in Action: Thinking About Your Major, Part 1

One decision that troubles many students in higher education is the choice of a major. Weighing the benefits, costs, and outcomes of a possible major is an intellectual challenge. This choice is an opportunity to apply your critical thinking, decision-making, and problem-solving skills. The following suggestions will guide you through this seemingly overwhelming process.

The first step is to discover options. You can use the following suggestions to discover options for choosing your major:

Follow the fun. Perhaps you look forward to attending one of your classes and even like completing the assignments. This is a clue to your choice of major.

See whether you can find lasting patterns in the subjects and extracurricular activities that you’ve enjoyed over the years. Look for a major that allows you to continue and expand on these experiences.

Also, sit down with a stack of 3 × 5 cards and brainstorm answers to the following questions:

• What do you enjoy doing most with your unscheduled time?
• Imagine that you’re at a party and having a fascinating conversation. What is this conversation about?
• What kind of problems do you enjoy solving—those that involve people? Products? Ideas?
• What interests are revealed by your choices of reading material, television shows, and other entertainment?
• What would an ideal day look like for you? Describe where you would live, who would be with you, and what you would do throughout the day. Do any of these visions suggest a possible major?

Questions like these can uncover a “fun factor” that energizes you to finish the work of completing a major.

Consider your abilities. In choosing a major, ability counts as much as interest. In addition to considering what you enjoy, think about times and places when you excelled. List the courses that you aced, the work assignments that you mastered, and the hobbies that led to rewards or recognition. Let your choice of a major reflect a discovery of your passions and potentials.

Use formal techniques for self-discovery. Explore questionnaires and inventories that are designed to correlate your interests with specific majors. Examples include the Strong Interest Inventory and the Self-Directed Search. Your academic advisor or someone in your school’s career planning office can give you more details about these and related assessments. For some fun, take several of them and meet with an advisor to interpret the results. Remember inventories can help you gain self-knowledge, and other people can offer valuable perspectives. However, what you do with all this input is entirely up to you.

Critical Thinking Skills in Action: Thinking About Your Major, Part 2

As you review the following additional suggestions of discovering options, think about what strategies you already use in your own decision-making process. Also think about what new strategies you might try in the future.

Link to long-term goals. Your choice of a major can fall into place once you determine what you want in life. Before you choose a major, back up to a bigger picture. List your core values, such as contributing to society, achieving financial security and professional recognition, enjoying good health, or making time for fun. Also write down specific goals that you want to accomplish 5 years, 10 years, or even 50 years from today.

Many students find that the prospect of getting what they want in life justifies all of the time, money, and day-to-day effort invested in going to school. Having a major gives you a powerful incentive for attending classes, taking part in discussions, reading textbooks, writing papers, and completing other assignments. When you see a clear connection between finishing school and creating the life of your dreams, the daily tasks of higher education become charged with meaning.

Ask other people. Key people in your life might have valuable suggestions about your choice of major. Ask for their ideas, and listen with an open mind. At the same time, distance yourself from any pressure to choose a major or career that fails to interest you. If you make a choice solely on the basis of the expectations of other people, you could end up with a major or even a career you don’t enjoy.

Gather information. Check your school’s catalog or website for a list of available majors. Here is a gold mine of information. Take a quick glance, and highlight all the majors that interest you. Then talk to students who have declared these majors. Also read the descriptions of courses required for these majors. Do you get excited about the chance to enroll in them? Pay attention to your gut feelings.

Also chat with instructors who teach courses in a specific major. Ask for copies of their class syllabi. Go to the bookstore and browse the required texts. Based on all of this information, write a list of prospective majors. Discuss them with an academic advisor and someone at your school’s career-planning center.

Invent a major. When choosing a major, you might not need to limit yourself to those listed in your school catalog. Many schools now have flexible programs that allow for independent study. Through such programs, you might be able to combine two existing majors or invent an entirely new one of your own.

Consider a complementary minor. You can add flexibility to your academic program by choosing a minor to complement or contrast with your major. The student who wants to be a minister could opt for a minor in English; all of those courses in composition can help in writing sermons. Or the student with a major in psychology might choose a minor in business administration, with the idea of managing a counseling service some day. An effective choice of a minor can expand your skills and career options.

Think critically about the link between your major and your career. Your career goals might have a significant impact on your choice of major.

You could pursue a rewarding career by choosing among several different majors. Even students planning to apply for law school or medical school have flexibility in their choice of majors. In addition, after graduation, many people tend to be employed in jobs that have little relationship to their major. And you might choose a career in the future that is unrelated to any currently available major.

Critical Thinking Skills in Action: Thinking About Your Major, Part 3

Once you have discovered all of your options, you can move on to the next step in the process— making a trial choice.

Make a Trial Choice

Pretend that you have to choose a major today. Based on the options for a major that you’ve already discovered, write down the first three ideas that come to mind. Review the list for a few minutes, and then choose one.

Evaluate Your Trial Choice

When you’ve made a trial choice of major, take on the role of a scientist. Treat your choice as a hypothesis, and then design a series of experiments to evaluate and test it. For example:

• Schedule office meetings with instructors who teach courses in the major. Ask about required course work and career options in the field.
• Discuss your trial choice with an academic advisor or career counselor.
• Enroll in a course related to your possible major. Remember that introductory courses might not give you a realistic picture of the workload involved in advanced courses. Also, you might not be able to register for certain courses until you’ve actually declared a related major.
• Find a volunteer experience, internship, part-time job, or service-learning experience related to the major.
• Interview students who have declared the same major. Ask them in detail about their experiences and suggestions for success.
• Interview people who work in a field related to the major and “shadow” them—that is, spend time with those people during their workday.
• Think about whether you can complete your major given the amount of time and money that you plan to invest in higher education.
• Consider whether declaring this major would require a transfer to another program or even another school.

If your “experiments” confirm your choice of major, celebrate that fact. If they result in choosing a new major, celebrate that outcome as well.

Also remember that higher education represents a safe place to test your choice of major—and to change your mind. As you sort through your options, help is always available from administrators, instructors, advisors, and peers.

Choose Again

Keep your choice of a major in perspective. There is probably no single “correct” choice. Your unique collection of skills is likely to provide the basis for majoring in several fields.

Odds are that you’ll change your major at least once—and that you’ll change careers several times during your life. One benefit of higher education is mobility. You gain the general skills and knowledge that can help you move into a new major or career field at any time.

Viewing a major as a one-time choice that determines your entire future can raise your stress levels. Instead, look at choosing a major as the start of a continuing path that involves discovery, choice, and passionate action.

As you review this example of how you can use critical thinking to make a decision about choosing your major, think about how you will use your critical thinking to make decisions and solve problems in the future.

A business journal from the Wharton School of the University of Pennsylvania

Four Pillars of Decision-driven Analytics

May 14, 2024 • 5 min read.

In an excerpt from their new book, Wharton’s Stefano Puntoni and co-author Bart De Langhe argue that the power of data can only be realized by leveraging human intelligence.

In a new book titled Decision-Driven Analytics: Leveraging Human Intelligence to Unlock the Power of Data , professors and behavioral scientists Bart De Langhe and Stefano Puntoni challenge the idea that our decisions should be driven by data. Rather, they argue that the power of data can only be realized by putting data in the background.

In this excerpt from their book, De Langhe and Puntoni draw from their own research and teaching to offer four pillars of decision-driven analytics.

In the mid-1850s, astronomers figured that the orbit of the planet Uranus was not like it should be according to the laws of physics. A French astronomer, Alexis Bouvard, thought that perhaps that was because we didn’t know about a planet further out in the solar system that exerted an influence on Uranus’s orbit. People started searching the sky for it. Soon enough, Urbain Le Verrier, another Frenchman, found the missing planet. It was named Neptune.

This was a great victory for the power of observation. Investing in data collection saved the day. It taught astronomers that the key to unraveling the mysteries of the cosmos was more and better data.

The rationale for making decisions with input from analytics rests on similar principles. Without data we navigate blind, while with data we can make decisions rooted in evidence. The implication is that good thinking means thinking with data.

The story doesn’t end here, though. An anomaly was soon observed also in the orbit of another planet: Mercury. The same Urbain Le Verrier who had found Neptune now hypothesized the existence of a missing planet lying between Mercury and the Sun. He called this missing planet Vulcan. Again, people started looking for it, only this time nobody could find it. Astronomers kept looking for Vulcan in the subsequent decades but the missing planet remained missing, and the mystery of Mercury unsolved.

The anomaly in the orbit of Mercury could be explained only half a century later. The explanation had to wait for Albert Einstein’s publication of a new theory of gravitation, called the theory of general relativity. This theory revolutionized our understanding of the universe by placing space and time in a four-dimensional continuum.

Although nobody knew that before Einstein entered the scene, all planetary orbits were in fact not conforming to Isaac Newton’s laws. Nobody knew that because the difference between the predictions of the two theories are smaller and smaller as you move away from the Sun. Only in the case of Mercury, which is the planet closest to the Sun, the curvature in space-time caused by the mass of the Sun was large enough for the divergence between the predictions based on Newton’s and Einstein’s theories to be detected by the telescopes of the time.

The mystery of Mercury was solved in a very different way from the mystery of Uranus. While the latter could be solved with better observations, the former could only be solved with better theory, by thinking without data.

Managers are like astronomers, looking to solve problems and find solutions in a complex world, where data is abundant but often hard to make sense of. The message is clear: Data and algorithms are crucial to making good decisions. But human judgment and intelligence are crucial, too.

The Four Pillars of Decision-driven Analytics

Many companies are witnessing an expanding gap between data and decisions, even with the goal of being a “data-driven organization.” The increasing complexity of data and algorithms can make it harder for decision-makers to collaborate with data analysts. For a business to thrive, it’s essential for both groups to understand and value each other’s expertise.

Many businesses find themselves overwhelmed by the sheer volume of data at their disposal. Putting decisions firmly at the center of the analytics process can be transformative. Starting with decisions and working back to the data will improve the quality of decision-making, improve the collaboration between managers and data analysts, and ultimately foster an organizational culture that is action oriented and that prizes the quality of decisions over ego or politics.

Here are the four core principles of decision-driven analytics:

• Decisions. Identify controllable, relevant decision alternatives. Consider diverse perspectives and a wide array of solutions. Prioritize feasible and impactful alternatives to achieve important business outcomes.
• Questions. Formulate precise questions that will help rank the identified decision alternatives. Ambiguous questions can lead to miscommunication and poor decisions.
• Data. Evaluate the data-generating mechanism. While Big Data can be tempting, the emphasis should be on collecting relevant data.
• Answers. When the earlier steps are done right, determining the best action becomes straightforward. Remember, acknowledging uncertainty and sidestepping overconfidence are key for informed decisions.

Decision-driven analytics is about making informed choices, not just processing data or flooding presentations with graphs. It emphasizes gleaning actionable insights from pertinent data. Embracing this approach means letting go of the notion that every data point is vital and not being distracted by the newest tools.

Data is just a means to an end. What matters is the decisions we make.

Excerpted and adapted from Decision-Driven Analytics: Leveraging Human Intelligence to Unlock the Power of Data, by Bart De Langhe and Stefano Puntoni, copyright 2024. Reprinted by permission of Wharton School Press.

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