The importance of critical thinking: a cost management and budget slant.
Critical thinking is essential to problem-solving in large organizations and on complex projects. Military operations often involve large units and outsized logistics requirements --both of which seem to cost enormous sums of money. Therefore, a synthesis of thought regarding critical thinking assists one in deriving, evaluating, and reflecting on potential decisions. This point is especially cogent for financial managers, who span the scope and scale of decisions. Thus, it is incumbent upon finance/resource management staffs to work across the organization to help drive the thinking process to produce informed cost effective decisions.... Undeniably, to assist the organization to think better.
Today's funding environment requires resource managers to bring enhanced skills and a wide view to decision-makers and decision-making forums. While critical thinking is perhaps the most important of these skills, you might ask, "What is critical thinking?" To answer this question, what follows takes the reader through the critical thinking process. Three excellent sources on critical thinking were used to develop this article. Taken together, these sources provide an overarching construct for thinking about thinking, and concept mappings to guide thinking. This construct aids understanding of the processes of good thinking and the concepts provide step-wise methods to think through specifics of problem solving. In The Miniature Guide to Critical Thinking, Paul and Elder introduce the nature of thinking and contend that everything depends on the guality of our thought. (1) In his paper "Thinking About Critical Thinking," Garras asks, "How do we develop these judgment skills in organizational leaders?" (2) He asserts that critical thinking is about one's judgment. In the third source, "Critical Thinking: What It Is and Why It Counts," Facione surmises that critical thinking has a purpose and discusses specific skills, methods, and innate dispositions. (3) Blending the authors' theses, one learns that critical thinking is a conceptual process of judgment that managers and leaders should possess; it is reflective and evaluative with a purpose.
Being "reflective and evaluative with a purpose" is, in a term we're likely more familiar with, analysis. Analysis is how to take what one knows, reflect on what the ground truth indicates, and gauge what it means to apply to the purpose at hand. With the addition of an identification of consequences or likely outcomes, one obtains thinking with discernment--the highest level of decision-making. This process is exactly what leaders are charged to do. Critical thinking is how one navigates change and seizes the opportunity to thrive in times of extreme hardship or in situations of disruptive technology application. In fact, critical thinking is often the precursor of a proactive disruption.
Within the financial/resource management community, strategic organizational leadership is rare. CFOs work for CEOs; comptrollers work for commanders. While formal leadership exists within the comptroller community itself, our leadership is often informal across the organization for the purposes of strategic and operational missions. As respected informal leaders, financial and resource managers have special opportunities to lead. Thinking critically aids that leadership seat at the table, respect within organization, and emanates externally to all stakeholders.
Reflecting on cost analysis and management, as well as budget analysis, yields informal funds managers able to evaluate situations to produce new alternatives for decision-makers and ultimately the warfighter, citizen, and taxpayer. Each cost estimator and budget analyst is encouraged to exercise informal leadership to reduce costs and maximize the effectiveness of our dollars. Numerous opportunities present themselves daily: should cost and should schedule analyses; business case analyses; analysis of obligation/expenditure profiles; integrated master schedule analysis; risk analysis/mitigation; as well as different approaches to base services provision and management or different applications for telecommuting and shared space.
In addition to critical thinking, other types of thinking, or discerning, exist. A few examples are creative, instinctive, and meditative thinking. One might easily confuse critical thinking with creative thinking. Although, the two may intersect or interact, they are indeed different. Critical thinking applies logical concept flow to developing thinking skills and methods. Creative thinking doesn't have to be logical; it produces new ways of comprehending the issues at hand. (4) Consider artistic versus analytical. While it's possible for these two types of thinking to operate concurrently, they are inherently severable and distinct. Further, it's possible to come up with a creative solution via critical thinking--at its essence, critical thinking doesn't require "breakthroughs," just the application of that which is already known within the bounds of learnable concepts to produce results.
Producing results is the job of senior leaders. Unarguably, results are paramount! Arguably, producing results is the objective of managers and leaders at all levels, by both formal and informal leaders. Thus, they all must possess the skills and methods for good thinking. One can easily agree with Gerras' contention that the gap between the desire for and the practice of critical thinking needs closing. Of primary importance is recognizing biases and focusing on how to evaluate information. (5) The current funds environment should be obvious to all of us. The view of how we see budgets and manage costs needs changing. Some of that change is underway; however, much of the success to-date comes from that which is easy to see and simple to remove, a.k.a. the proverbial low hanging fruit. Thinking critically is essential to changing the way we do business. Budget, like cost, requires analysis to be done to the benefit of warfighters, citizens, and taxpayers; but this community must continue to push into other neighborhoods to understand the foundations and drivers of costs. Once we have those understandings, we can leverage our analytical skillset to think critically and expunge further costs. The ideal is two-fold: first, to reduce budget pressure without depriving the mission; or second, find a new cheaper way to complete the mission.
In order to glean the most from cost consciousness efforts, one must achieve a self-awareness of their egocentric and ethnocentric biases. Within our community that might mean a realization that much of what we do is regulatory in nature, not directly required to meet the organizations primary mission. Applying critical thinking to cost management and budget analysis will enhance our everyday experience, allowing for a better interaction between stakeholders. Critical to sharing organizational points-of-view and opening all to broader thought processes, and ultimately to new ideas, is the participation of financial personnel in broader aspects of the planning and preparation for fulfilling the mission. Everything costs money, therefore the financial role spans all aspects of the organization. Too often we are wedded to our preconceived notions and ways of doing things or the products/processes used to arrive at decisions. Changing these are key aspects of learning, and critical thinking opens the path to reasoned enlightenment.
Open-mined recognition of biases and refection on the problems at hand should improve leadership ability, as well as the quality of the decisions made by leaders. As the current problems and limitations of the defense business, warfighter roles and missions present themselves, parallel and iterative thinking with deference to purpose, problem, assumptions, point-of-view, data, ideas, inferences, conclusions, and consequences synthesize to produce new solutions. (6) Solutions materialize as different views and experiences assuage problems, and as resource managers exchange thoughts amongst themselves and, more broadly, with other functional communities and organizational leaders.
Constructive involvement within your environment will engender the development of critical thinking skills and abilities. This interaction develops personal leadership ability on strategic topics, which benefits the organization and its missions. As people better understand what critical thinking is and how to do it, we will make critical thinking more common than it is scarce.
(1) Richard Paul and Linda Elder. The Miniature Guide to Critical Thinking: Concepts & Tools. (Dillon Beach, CA: The Foundation for Critical Thinking, 2001), 1.
(2) Steve Gerras, "Thinking Critically about Critical Thinking: A Fundamental Guide for Strategic Leaders." (Carlisle Barracks: U.S. Army War College, June 2006), 3.
(3) Peter A. Facione, "Critical Thinking: What it is and why it counts," (Millbrae, CA: California Academic Press, 2007), 4-8.
(4) Ibid, 12.
(5) Steve Gerras, "Thinking Critically about Critical Thinking: A Fundamental Guide for Strategic Leaders." (Carlisle Barracks: U.S. Army War College, June 2006), 12.
(6) Richard Paul and Linda Elder. The Miniature Guide to Critical Thinking: Concepts & Tools. (Dillon Beach, CA: The Foundation for Critical Thinking, 2001), 3-4.
Colonel David L. Peeler, Jr.
Colonel Peeler is Deputy Director, Financial Management & Comptroller for the Air Force Life Cycle Management Center. He is a graduate of the Air Force Institute of Technology, a certified cost estimator/analyst, and a certified acquisition professional in test, financial, and program management. Among other affiliations, he is a member of the ASMC & ICEAA.
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|Author:||Peeler, David L., Jr.|
|Publication:||Armed Forces Comptroller|
|Date:||Mar 22, 2016|
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