Learning Critical thinking is not optional, but essential for good decision making

Technology is in a state of major churn. Every single industry is being reinvented, and technologies such as AI, Cloud computing, IOT, advances in biotechnology, genetic engineering and nano technology are disrupting today's products and businesses. Millions of jobs will be lost, while several new ones are created. And many businesses will shut while new businesses come up. 

No industry and no job is protected from disruption and obsoletion. In this fast paced, accelerated obsoletion, and highly disruptive period, managers and businesses need a lot of skills to innovate, grow, and stay in business. Managers need to make sure they are able to spot threats and opportunities and are skilled in evaluating them. At no time more than ever, does each manager need to be skilled in Critical thinking. 

Why Critical thinking? Managers make several decisions in the organization. A good decision takes the organization forward while a bad one can have varying degrees of negative impact. Research over the years has shown that decision making is prone to severe errors due to underlying poor reasoning capabilities and an ignorance of cognitive biases that mar our perception of reality. Many of the research findings are only now finding their way into management books on decision making. Often these mistakes are not evident or caught due to a lack of training and awareness. And awareness also doesn't always help and needs further strategies to mitigate the risks these biases bring to decision making.    

Here are a few of the cognitive biases and fallacies that have been researched and known to subvert good decision making. 

Fallacies: Hasty generalization, Perfectionist fallacy, line drawing fallacy, Groupthink and Bandwagon effects, Ad Hominem Fallacy, Base rate neglect and a few more. 

Cognitive biases: Confirmation bias, Survivorship bias, Anchoring, Availability bias, Authority bias, Projection bias, Base rate neglect, Clustering illusion, Contrast effect and a few more. 

To assess the influence these have on decision making, you can check out what each of these fallacies and cognitive biases entail. Decision making also involves reasoning. Critical thinking can mitigate many risks of errors in decision making. At the root, Critical thinking has logical reasoning, fallacies and cognitive biases as its components. Critical thinking skills also encompass an understanding of moral reasoning, rhetoric and rhetorical devices. Decision making often involves making moral judgments, and an understanding of Moral reasoning helps in making better judgments. 

Where do these critical thinking components fit into decision making? Lets take a look at a typical decision making process. It will follow these steps or a variation of the steps below

Thee scope for error starts right from 'Framing' the problem. We are vulnerable to a bias called 'The Framing bias/Framing effect which will determine the direction in which the problem resolution moves. 

Framing the problem also requires an understanding of cause and effect, and a knowledge of Causal reasoning will ensure that there are no errors due to bad causal reasoning. What evidence is required flows from Causal reasoning. An understanding of inductive reasoning will reveal hidden assumptions, validation of which will logically lead to the need for further evidence. 

For developing and evaluating alternatives, apart from deep domain knowledge, you also need to apply causal reasoning and inductive reasoning - Does this alternative (cause) solve the problem (effect), and which is the alternative that best solves the problem (strong inductive argument). 

Not knowing these components of critical thinking means that the manager is making decisions purely based on his earlier observations, experience in similar situations in the past, and maybe inputs from his team. Even when the organization demands a structured well laid out process for decision making, the manager will be operating without the benefit of essential skills. Daniel Kahneman's research indicates that humans operate as if 'What you see is all there is' (WYSIATI) - which means that any manager not aware of fallacies and cognitive biases is likely to be biased with confirming evidence, and unlikely to find other evidence in the market, that is actually present. This WYSIATI bias is probably one of the reasons that managers miss out spotting new trends and threats in the market time and again.