Di8scuss the below:
How are critical thinking and decision making related? Consider styles of decision making that use heuristics. Are we thinking critically when we use heuristics in decision making? Explain your answer. Practical Application: Describe a decision you have recently made. Evaluate your use of heuristics vs. critical thinking.
Critical thinking and rational decision making are related. First a definition of critical thinking is needed. Next a description of rational decision-making is needed.
Critical thinking is that mode of thinking--about any subject, content, or problem--in which the thinker improves the quality of his or her thinking by skillfully taking charge of the structure inherent in thinking and imposing intellectual standards upon them. (The Critical Thinking Company, n.d., para. 10)
The rational decision-making model is held as the gold standard for decision making. It is based on a logical search for the best solution based on a systematic process and consists of six steps. The steps of the rational decision making model are as follows (Bateman & Snell, 2013, p. 90):
1) Identifying and diagnosing the problem
2) Generating alternative solutions
3) Evaluating alternatives
4) Making the choice
5) Implementing the decision
6) Evaluating the decision
According to Webster's New Collegiate Dictionary, heuristics are defined as concepts providing aid and or direction in the solution of a problem but otherwise unjustified or incapable of justification. Or relating to exploratory problem solving techniques that utilize self-educating techniques (as the evaluation of feedback) to improve performance experience. (1973, p. 538)
According to Cherry, heuristics are commonly referred to as "decision short cuts allowing decision makers to quickly make decisions" (n.d., para. 1). Heuristics include such things as rules of thumb and educated guesses "while heuristics are helpful in many situations, they can also lead to biases" Cherry, n.d., para.1) Critical thinking strives to "diminish the power of ...egocentric and sociocentric tendencies" The
Critical Thinking Company, n.d., para. 8).
Thus, heuristics, while useful can introduce bias and misinterpretation into the decision making process. A common rule of thumb for a company's current ratio (current assets divided by current liabilities is 2.0 or higher (Hitt, Ireland & Hoskisson, 2013). However, Walmart uses aggressive cash management procedures and application of the rule of thumb falsely states Walmart's financial condition.
References
Bateman, T. S., & Snell, S. A. (2013). Management: Leading and collaborating in a competitive world (10th ed.). New York, New York: McGraw-Hill Irwin.
Cherry, K. (n.d.). Availability heuristic. About.com Psychology. Retrieved from
https://psychology.about.com/od/aindex/g/availability-heuristic.htm
Hitt, M. A., Ireland, R. D., & Hoskisson, R. E. (2013). Strategic management: Competitivenessand globalization (10th ed.). Mason, OH:
South-Western CENGAGE Learning.
Merriam-Webster. (1973).Webster's New Collegiate Dictionary. Springfield, MA: G. & C. Merriam Company.
The Critical Thinking Company. (n.d.). Defining critical thinking. Retrieved from
https://www.criticalthinking.org/pages/defining-critical-thinking/766