Critical Thinking Triad Insurance Company Essay

Introduction The term critical thinking refers to â€Å" †¦ to a wide range of cognitive skills and intellectual dispositions needed to effectively identify, analyze, and evaluate arguments and truth claims, to discover and overcome personal prejudices and biases, to formulate and present convincing reasons in support of conclusions, and to make reasonable, intelligent decisions about what to believe and what to do†¦ â€Å"   (Bassham, G., et al, 2005).     It serves as the foundation of objective analyses that leads to the correct problem definition resulting in the generation of sound alternative courses of action.   In the absence of critical thinking models, companies can fall into decision-making traps where, unconsciously, they are forced to make the wrong decisions (Langlois, G, 2007). What are the issue and conclusion? The case study, as embodied in the Memorandum to the Chief Executive Officer, dated September 20, 2007, presents a prescriptive issue, to establish or not a leadership development program for Triad Insurance Company of Indianapolis (TICI).   Ms. Denise Khali (Vice-President of Human Resources) specifically recommended disapproval of the proposal submitted by the Director of Operations, Mr. Ralph Clarke. What are the reasons? As VP of human resources and from her personal standpoint, Ms. Khali presented various arguments, notions and ideas to support her recommendation. TICI has 12 senior executives and none has attended a leadership development program. The past performance of TICI casts doubt on the necessity of the program. Supporting reason 1: TICI is over 50 years old.   The continued operation of TICI suggests a successful business undertaking.   Even at over 50 years, there is no end in sight for its continued operations, increasing its going-concern value. Supporting reason 2: TICI has an annual average growth rate of 12%.   There is a presumption that the 12% growth rate is acceptable in the insurance industry where TICI is located. Supporting reason 3: The age and growth factor of TICI are indicative of the company’s prosperity. According to Ms. Khali, the successful and effective leadership experience of TICI suggests that â€Å"leaders are born, not made.† Supporting reason 1: Ms. Khali surveyed TICI’s senior staff on the notion that â€Å"leaders are born, not made.†Ã‚   The survey result showed that all, except one, agreed with this notion. Supporting reason 2: Dr. Carleton Parker, a famous economist, has a similar stance. Supporting reason 3: Ms. Khali refers to an existing â€Å"entire school of leadership theory† that the world’s famous leaders possess common traits – that â€Å"cannot be learned; they are innate.† Ms. Khali cited her personal observation that leaders have a genetically determined tall physical stature. Supporting reason 1: She cited two internet websites Laughter Genealogy and IMDB that presented a partial list of American leaders, of different generations, having a height of more than six feet. Supporting reason 2: All of TICI’s senior staff members have heights of over six feet tall.   With the exception of Mr. Ralph Clarke, the leadership training advocate. The intentions of Mr. Ralph Clarke are doubtful with regards to his ambitions and liberal views on education and achievement. Supporting reason 1: Ms.Khali believes Mr. Clarke covets her position as VP of Human Resources. Supporting reason 2: Ms. Khali believes Mr.Clarke is out to discredit her. Supporting reason 3: According to Ms. Khali, Mr. Clarke believes every citizen can get anything they desire through each citizen’s right to get education. Supporting reason 4: The leadership theories of Aspen Institute do not fit in the culture of TICI. Agreement to the proposal will set off requests for expensive trainings that TICI cannot afford. Training staff without leadership traits is a waste of money. Supporting reason 1: Two research studies, described as â€Å"well-respected,† concluded that personality traits point to a person’s leadership potential.   These two studies appeared in the Journal of Applied Psychology and Leadership Quarterly.   There was no mention of the specific issues where they appeared. Supporting reason 2: Recruitment efforts should focus on applicants with leadership traits. Which words or phrases are ambiguous? We review the reasons cited above for ambiguity.   Vague words undermine the strength of the reasons supporting the conclusion.   The discussion of ambiguity also opens the door to look into the proposal itself for weaknesses and possible points of misunderstanding.   The Background Section identifies the ultimate purpose of the training program as preparation for â€Å"future advancement† of 20 junior executives annually into executive positions.   There was no justification on the number of trainees.   Does TICI have as many executive positions to fill up in the short or medium term?   The phrase â€Å"future advancement† can be broken down into the exact executive positions with vacancy and in what future timeframe.   The training program can be viewed as an investment and the training costs can be matched with the costs of pirating executives to see which is feasible. The term prosperity in Reason 1 can mean increases in value in different things.   The increase can refer to gross sales, net profit, net worth, goodwill, and others.   In the insurance industry, cash flow is not proportionate to sales levels as there is no guarantee in the collection of annual premiums due to nonpayment or termination of contact by the policyholder.   Even if an insurance company is growing in terms of premium sales, there is the possibility of cash flow problems that will translate in operational problems, including training activities by the Human Resource Department. Reason two, uses a very general description of TICI leadership in the words successful and effective.   The words suggest that TICI leadership is successful in all areas of corporate management – finance, operations, marketing, sales, administration, information systems, and others.   If that is the case, there is no need for an outsourced training program.   The best training the junior executives can get is from the company leadership itself.   The Human Resource Department can develop in-house training programs.   Ms. Khali was silent on this possibility.   She did mention training of personnel with leadership traits, but she failed to elaborate. Ms. Khali conducted a survey to support the notion that â€Å"leaders are born, not made.†Ã‚   She did not inform the technicalities as to sample population characteristics, sample size, and others.   It could have been a simple query to a select group such that the procedure itself is biased.   Therefore, in this case, the result is also biased.   The use of the descriptive phrase â€Å"entire school of leadership theory† suggested a huge following but said following is unverifiable. Reason 4 reveals power play and Ms. Khali accuses the Operations Director of discrediting her.   There seem to be an assumption the training proposal of Mr. Clarke is needed by the company and the VP of Human Resources was not able to see or sense this.   Therefore, she may have been bypassed in the formulation of the proposal.   How the leadership theories of Aspen do not fit the culture of TICI is in itself vague. Ms. Khali mentioned subsequent requests for expensive trainings are something TICI cannot afford.   Are they having cash flow problems even if the company is experiencing a long period of prosperity? What are the value conflicts and assumptions? The case facts limit us to values in the work place.   A good reference in analyzing the interplay of values in Triad Insurance is Schwartz’s Values Circumplex (McShane & Von Glinow 2:47, 2005).   The case facts present bipolar positions where the VP of Human Resources assumes conservative values while the Director for Operations assumes values reflecting openness to change.   This explains, in part, the actions of the two protagonists and the values they are assumed to have.   Ms. Khali possesses the values of conformity (adherence to corporate culture), security (tenure and stability) and tradition (moderation and maintenance of the status quo). Mr. Clarke whose values cluster on the opposite side of the model is assumed to possess the values of self-direction (independence in thinking and action) and stimulation (facing challenges and taking risks).   The Schwartz model also has vertical bipolar clusters around self-transcendence and self-enhancement.   From this dimension, only the values clustering around self-enhancement are present, from the facts given in the case.   Both protagonists possess the values of achievement (personal success) and power (dominance over others within the organization).   The conflicting values and assumptions explain the collision course of the two corporate protagonists. What are the descriptive assumptions? The first descriptive assumption is that the senior executives know almost everything about leadership and further training is unnecessary.   This assumption is hard to accept in this age of globalization, which promotes the free flow of information, resources and people (Jrank, 2007).   Several decades ago, the concept of international competition was limited to the big multinationals.   With the developments in information technology, competition is now global in character and big and small players can compete in various geographic locations at the same time or within cyberspace itself. Genetics play an important role in determining leadership traits of every person.   Ms. Khali relied heavily on this descriptive assumption to support her recommendation not to accept Mr. Clarke’s proposal.   Underlying this descriptive assumption is another descriptive assumption that exposes Ms. Khali’s incapability of adequately supporting her arguments.   The data on leader heights she presented to the CEO was taken from the Laughter Genealogy website.   Professional journals are readily accessible in the libraries and the internet and are better sources of reliable data and information. The case did not present much information on Mr. Clarke.   It was apparent that Ms. Khali was wary of Mr. Clarke’s intentions and she was convinced that the latter was after her position.   The manner by which Ms. Khali reacted, gathering supporting arguments left and right and throwing accusations, seemed to indicate another descriptive assumption.   Ms. Khali was insecure of her position in the company for reasons not stated in the case.   She was desperately protecting herself in the ongoing power struggle, as she perceived it. Are there any fallacies in the reasoning? The following analysis on fallacies is based on the article of Haskins (2008) as posted on the Skepdic website. Ms. Khali has committed the fallacy of argument from ignorance and the fallacy of begging the question when she argued that all, except one, senior executive of TICI are over 6 feet tall that explains why they are â€Å"successful and effective† leaders.   She also committed the fallacy of false analogy by quoting Dr. Carleton Parker in proving that only a select group can be leaders and they are genetically determined to become leaders.   What Dr. Parker said is that each human being is born into this world with â€Å"rich, psychical disposition† that provides â€Å"all his motivations of conduct.†Ã‚   She also committed the fallacy of slippery slope when she argued that there would be more requests for expensive trainings if the leadership program were approved. It is only a claim but remains to be proven.   Upon concluding her arguments, she also committed the ad hominem fallacy by shifting her criticisms from the leadership program to the character of Ralph Clarke accusing him of coveting her position.   She resorted to the ad populum fallacy when surveying the acceptance of the notion that leaders are born, not made.   The survey was more of a popularity vote on an idea rather than a serious attempt to establish statistical probabilities. How good is the evidence? The evidences given by Ms. Khali were gathered to support her decision not to recommend the acceptance of the proposal.   On the contrary, whatever position she takes will be more acceptable with a study that will show the feasibility of the proposed program.   She capped her memorandum with personal accusations that were impossible to prove or defend. Are there rival causes? As Vice President of Human Resources, it was the prerogative of Ms. Khali to recommend or not the leadership-training proposal.   It is assumed that anybody n her position will recommend what is best for the company.   The memorandum she wrote was filled with ambiguities and fallacies.   As she cast doubt on the intentions of Mr. Clarke a similar cloud of suspicion hung over her intentions. The manner by which her memorandum was crafted was not deserving of the CEO.   All these factors indicate the possibility of rival causes.   Did Ms, Khali recommend the rejection of the proposal as part of her job as vice president or did she make that recommendation to protect her hold on the position of vice president?   Conflicting values as discussed above indicated a collision course between the two major players in the case.   Corporate executives live with conflict and are expected to resolve them in a professional manner expected of them. Are the statistics deceptive?  Ã‚  Ã‚  Ã‚   The proposal itself and the arguments against it contain deceptive statistics.   Training 20 junior executives for senior positions every year indicates a requirement stemming from growth or a fast turnover of senior executives.   Both of these two possible reasons remain unsupported throughout the case.   If the number of junior executives for training were down to five, for example, would it have been more realistic for the company?   Ms. Khali did not look at it from this perspective; she simply went all out to prevent project implementation. Dr. Carleton Parker was quoted as supporting the hypothesis that a select group is genetically destined to become leaders.   What Dr. Parker said was all human beings are psychically equipped to face motivations in his lifetime. What significant information is omitted?   The pros and cons of the project proposal did not get equal investigation.   The memorandum would have gained much credibility if the side of Mr. Clarke was sought and presented in the memorandum.   Perhaps, Ms. Khali was not consulted during the formulation of the project proposal causing her personal hurt and doubts as to the real intentions of Mr. Clarke.   In retaliation, she presented only her side of the picture.   In the absence of Mr. Clarke’s arguments, the memorandum could have achieved a sense of balance and fairness if both sides of the coin were represented in all the arguments used. What reasonable conclusions are possible? There were so many ambiguities and fallacies in the memorandum.   Perhaps the CEO will ask an improved version, one expected of a vice president.   A balanced report will provide stronger arguments and the opinion of Mr. Clarke may be required in the modified memorandum.   The CEO may ask other parties to conduct the investigation.   Both the proposal and the arguments have weaknesses and points to the possibility that personal interest weighed heavily against that of the company. Conclusion As mentioned, critical thinking is a requirement to generate the right arguments, generate Alternative courses of action and make the right decisions.   By not following a critical thinking model, the company finds itself with the wrong decisions.   Many decision alternatives are arrived at because of the poor thinking styles used in the process.   As a result, companies unconsciously limit their own decision choices. Langlois (2007) identifies several heuristic (decision) traps companies face.   In the case of TICI, a decision based on Ms. Khali’s memorandum will force the company into a framing trap that prevents the generation of other alternatives to the proposal presented.   It is the responsibilities of the CEO to identify heuristic traps and develop strategies that will guide the company develop a healthy decision making environment. References Bassham, G, Irwin, W, Nardone, H, & Wallace, J (2005). Critical thinking, 2nd ed. New York, NY: McGraw-Hill/Irwin. Haskins, G. (2008). A practical guide to critical thinking.   Retrieved January 20, 2008, from   http://skepdic.com/essays/haskins.pdf Jrank, 2007, Modernization theory – globalization theory.   Retrieved January 16, 2008, from   http://science.jrank.org/pages/10275/Modernization-Theory-Globalization-Theory.html Langlois, H. (2007). The challenge of changing, part II. Massachusetts: Cambridge [Course notes.]   Retrieved   January 14, 2008, from http://isites.harvard.edu/fs/docs/icb.topic203996.files/Challenge_in_Changing092507B.ppt McShane, S.L., Von Glinow, M.A. (2005). Organizational behavior: emerging realities for the workplace revolution, 3rd ed. New York: McGraw-Hill Education.