CRITICAL THINKING AND DECISION MAKING IN BUSINESS

The Role of Critical Thinking in Business Decision Making

With new technologies and increased global interconnectedness, business has become more complex over the past few decades. Making sense of this world and making the right decisions involves a great deal of critical thinking. Making informed, rational decisions based on all available information rather than assumptions and feelings is important across all sectors and roles.

Why is critical thinking so important to business decision making?

Critical thinking and decision making in business is an essential element of success. This is evidenced by a recent DeakinCo.’s report The Business Return on Learning and Development, developed in partnership with Deloitte Access Economics, which found that critical thinking is one of the top five skills gaps in Australia.

Helps your team think beyond conventional ideas and bias

Rather than accepting how things ‘have always been’, critical thinkers question assumptions and look for new solutions. This also leads them to investigate their own biases so that they can actively challenge them and work to overcome them.

Fosters a culture of creativity and innovation

Critical thinking is closely tied to creativity. Both involve questioning assumptions and gaining new perspectives, and lead to innovative solutions. In an organisation where critical thinking is promoted, creativity and innovation become part of the culture.

Helps your business predict risks before they even happen

Another aspect of critical thinking is the ability to predict risk and come up with solutions and mitigation measures. Critical thinkers are able to infer possibilities based on the information given and make predictions about outcomes, which informs their risk assessment and strategy.

Helps your business solve complex problems with no clear solution

If there was always an obvious right answer to every problem, you probably wouldn’t need to worry about your team’s critical thinking skills as much. However, most of the issues businesses encounter are complex and need a critical thinker to tease apart. Solving problems with no clear solutions requires critical thinking skills.

Examples of how critical thinking skills are used in business decision making

Considering that critical thinking was named as one of the top 10 most important job skills of the future by the World Economic Forum, it’s unsurprising that there are a host of examples of critical thinking and problem solving in the workplace.

Reflecting on the outcome of a recent project

Thinking critically about outcomes, why they occurred, what can be improved, and identifying the most important lessons learned are an essential aspect of good project management.

Analysing how to improve a process

Following on from that, this kind of analytical thinking and ability to reflect can also be applied to more general processes. Improving processes also involves innovation and creativity, two central elements of critical thinking.

Prioritising tasks under time and resource constraints

Knowing what’s most important and what needs to be done now rather than later is vital for every employee. The more tasks arise, the more complex this process becomes, and the more critical thinking is required to make the right choices.

Making decisions about employees

When hiring new talents, deciding who to promote, and how to manage a team, it is vital that leaders and HR professionals are able to objectively judge a situation, question their own biases and make rational decisions. This is one of the many reasons why critical thinking in management is a need, not a want.

Launching a completely new strategy

Risk assessment, predicting outcomes, establishing priorities, evaluating the alternatives to the solutions proposed, and anticipating problems are all part of designing a new strategy.

How to encourage critical thinking in your business

While it is a soft skill that can sometimes be hard to grasp, critical thinking skills can be taught and fostered by creating conducive environments and engaging employees directly.

Implement brainstorming sessions

Brainstorming frees people up to express their ideas, increases creativity, and can help teach them to approach problems from all angles.

Give employees the freedom to discuss

Discussion fosters exchange, challenges assumptions and allows employees to recognise that their own perspective may be limited. While discussing, they will be practising their critical thinking skills.

Use data-driven decision making

Implementing data-driven decision making in your organisation invites your employees to take decisions more carefully, consider all the facts and become more data literate.

Review and reflect on performance and project outcomes

Have frequent, structured discussions about performance and project outcomes, where you encourage team members to share their own reflections. This fosters growth and increases your staff’s ability to think critically about their performance and decision making.

Invest in developing critical thinking skills

Like all other skills, critical thinking can be taught and improved. DeakinCo.’s soft skills courses focus on teaching critical thinking as well as many adjacent skills like problem solving, self management, and collaboration, taught by experts.

Learn how DeakinCo. helps business promote critical thinking.

Through our corporate training offers, we can tailor our programs to your organisation. From our soft skill courses to our technical skills training courses all the way to implementing your day-to-day employee training programs, there is a solution for every business. Promoting critical thinking in your organisation can be easy when you have expert support.