Critical Thinking and Managerial Decision Making

Running head: CRITICAL THINKING AND MANAGERIAL DECISION MAKING
Critical Thinking and Managerial Decision Making
Name of the Student:
Name of the University:
Author Note:

1CRITICAL THINKING AND MANAGERIAL DECISION MAKING
Decision making skills are one of the indisputable skills that any manager cannot do
without. In every organization, managers need to analyze critical situations and take decisions
that will benefit the organization (Ghazivakili et al., 2014). I want to pursue a career as a
manager in the Grocon Company. Grocon is presently Australia’s largest real estate company
and are engaged in projects related to residence, offices, restaurants, business hubs,
commercial centers, shopping malls, skyscrapers, hospitals and many more. Their mission
and vision includes conducting their business with safety, sustainability, community and
innovation. Being a highly competitive industry and the leader in the market, people working
in Grocon need high performance skills (Careers | Grocon | Creating amazing and enduring
real estate., 2019). The managers that work for the company must have many analytical as
well as decision making skills. It will enable them to manage the work of the organization.
The skills that are necessary if I want to excel in an organization like Grocon are good
reasoning, analytical capability, decision making skills and implementation. The concepts
and theories that will support these skills are, 1. Deductive 2. Inductive 3. Abductive and 4.
Psychological Contract Theory.
The Deductive approach to any problem or situation starts with the creation of
hypothesis or assumptions that is based on the existing knowledge and theory (Novaes,
2013). This hypothesis then tested using different research strategies. It is widely used in
scientific research processes and is an extremely important skill. This approach is often called
top-down method and has a general to specific approach. In this method, the process starts
with a proposition or premises that work as the base of the hypothesis. Once the hypothesis is
drawn, it is tested through research and specific conclusions and relations are drawn from it
(Hesse et al., 2015). I believe that this is a necessary skill as it will give me the ability to look
at problem in a more constructive way. In my personal and my professional life this would
prove useful while taking managerial decisions.
The Inductive theory is quite the opposite of deductive. This approach is known as
bottom-up thinking process where general conclusions and patterns are determined from
specific observations (Battaglia et al., 2018). In many scenarios in our life we observe
incidents that form logical connections in our mind and we make general or broad decisions
or assumption in order to make sense of the situation. our thinking and decision making
capacity are largely guided by those and affect them both positively and negatively. Our
surrounding, our education and learning, the conversations happening around us have the
ability to influence our inductive reasoning. This aspect is especially important to me because

2CRITICAL THINKING AND MANAGERIAL DECISION MAKING
these reasoning are much more flexible than the deductive ones as they are not completely
supported by facts or hard truths. Thus, in adaptive scenarios, inductive reasoning can
provide us with opportunities where we are able to examine our own assumptions with facts
and figures.
The abductive theory is based on prior knowledge and experience of the individual. In
this thinking method, people often become prejudiced or blinded by their prior knowledge
and cannot think outside the box (Mirza et al., 2014). Using abductive thinking, they may
invite new perspectives into the matter from people that are around them and those that he
thinks are less experienced than him. In many cases, a person’s prior knowledge helps us to
understand a situation better. This is the reason why older people are sought after for advice
in both social and professional scenarios. Coupled with a person that have the ability to give a
fresh perspective on old incidents, this thinking process might prove to be formidable in all
spheres of life and that is the reason for which I think this skill to be an important aspect
(Kaiser, Fordinal & Kragulj, 2014).
Psychological contract theory is about the implied or explicit conditions in a contract.
A successful Psychological Contract generally has several characteristics. They should be
voluntary, mutually agreed and incomplete in nature. There are generally multiple people
involved in the process and if it fails the losses needs to be managed. This method is applied
in interpersonal and professional scenarios (Eckerd et al., 2013). There are three types of
Psychological Contract, relational, transactional and hybrid. Each of them contains different
aspects that create basis for organizational contracts depending on the type and job
description for which the contract is being made. Having the ability to form Psychological
contract is necessary as they provide guidelines about the expectations of the employees and
the likely reactions and losses that the fail of the contract may cause. This is extremely
necessary for managerial profession.
The concepts and knowledge about the above mentioned theories will help me in my
personal, interpersonal and professional life. In professional scenario I will need them for my
job as a manager in Grocon. Grocon is a large business and thus appoints a large number of
human resources. The company also runs several processes and as a manager I will need to
think each issue critically, rationalize the key aspects and take decisions. The managers need
to create plans and strategies for profit making and brand popularity. Manage projects and
their on-time delivery and recruit and manage employees. The concepts that I learned will