There are many reasons why companies both big and small fail to meet their objectives, and sometimes go out of business. Broadly speaking, much of it has to do with not thinking through critical decisions long and hard enough.
With shorter deadlines and increasing work pressures, people often do not have time to do due diligence, to spare enough time thinking about a problem and researching enough solutions. In the interest of saving time, executives — including those at c-suite levels — rely upon assumptions and knowledge from prior experience to make decisions.
We all know the changing market dynamics and increasing integration of technology have intensified competition.
Having experience from serving as interim CEO, CFO, and COO for more than one dozen companies, Helen has compressed her years of experience and learning from her research into “three simple things that you can do to improve your critical thinking skills:”
1. Question assumptions
Helen writes that “The first step in questioning assumptions, [...] is figuring out when to question assumptions. Turns out, a questioning approach is particularly helpful when the stakes are high.”
Naturally, when the consequent action of a decision is large, it is worth taking the time to critically think about the decision, question the assumptions one is making for likely results. For example, why do you think a particular action will increase sales or why would a decision impact growth of the company. Questioning assumptions will help you seek better answers.
If you’re right, you’ll find support facts, and if not, then you’ll be avoiding a potentially bad decision.
2. Reason through logic
Helen advises to “pay close attention to the “chain” of logic constructed by particular argument. Ask yourself: Is the argument supported at every point by evidence? Do all the pieces of evidence build on each other to produce a sound conclusion?
Once you know the assumptions you are making, the best way to know whether you are right in making those assumptions is to find facts, research and data that support as well as dispute your theories. Then take a logical approach to reason out both sides of the argument and pick the rational winner.
3. Seek out diversity of thought and collaboration
“If everyone in our social circles thinks as we do, we become more rigid in our thinking, and less likely to change our beliefs on the basis of new information,” writes Helen.
People from different backgrounds can often lend unique perspectives which are highly advantageous when making business decisions. This is not necessarily just race or cultural background, but even people who sit in different departments can lend different viewpoints.
Entrepreneurs, especially those of startups and SMEs who want to grow strong and fast, need to diversify their teams. It’s not necessarily advantageous to have someone who has had a perfect career on paper in the same industry. Look for people with diverse experiences and from different backgrounds to build a stronger team. And of course, encourage critical thinking, especially for big decisions.