Inference is the process of moving to a conclusion based on premises or specific evidences. Jumping to the conclusion often leads to biases. Ladder of inference is a framework that guides the thinking process of people so that the accuracy of the inferences or drawn conclusions can be increased. According to the theory of ladder of inference, there are mainly seven steps of the thinking process. Those are gaining experience, selected reality, interpreted reality, making assumptions, drawing conclusion, analyzing beliefs and taking actions. In the first step of inference, people gains experiences from facts and reality. Human experiences can include different types of facts and from those elements, it is important to choose one specific event which needs to be interpreted for taking decisions. This chose element is called selected reality and the reality is interpreted in the third step of the ladder of inference. After interpreting the data or the elements of the selected reality, assumptions are made. The assumptions are modified later based on common beliefs. At final stage of the ladder of inference, actions are taken according to the beliefs and assumptions. This is the common process of drawing conclusions from data or inference. People usually follow this process unknowingly. The process usually helps in taking better decisions in life. However, there are also some limitations of depending on ladder of inference. The essay critically evaluates the relevance of ladder of inference in the process of decision making.
The ladder of inference has been founded by Chris Argyris who was a professor in the Harvard business School during the 70’s. In 1992, the Argyris wrote a book named “The fifth discipline” in collaboration with another writer named Peter M. Senge. The book became very popular along with the theory of ladder of inference which was the main focus of the book (Cockburn, 2018). Ladder of inference is a model hat shows the common steps of inductive reasoning. Inductive reasoning is the process of inference in which a conclusion is drawn from a number of premises that are based on real-life experiences. Philosophers say that inductive reasoning and inferences are usually not valid because there are exceptions to common experiences (LIN & JIANG, 2020). Along with that, the validity of inductive inference largely depends on the validity the premises and it is difficult to judge the validity of premises properly. However, if the validity of the premises is tested e properly using proper methods and decisions are made based on valid premises, the decisions are often nearly perfect. The ladder of inference is a tool that guides the process of decision making using real-life experiences. It suggests the thinkers to gain experience select specific elements from the experience and interpret the experience properly before drawing conclusion or making any decision.
Inference is often considered as the first step of important inventions and ladder of inference is used as a tool for making accurate inference. As per the point of view of Gati, Levin & Landman-Tal (2019), when people do not follow a logical way to move from raw data to conclusion, it often leads to wrong decisions. Ladder of inference shows how raw data collected from experiences need to be interpreted and the findings can be aligned with existing beliefs and theories in order to draw effective conclusion. It is not always that the conclusion drawn using the ladder of inference will be always true but it can be said that the logical process of thinking helps reducing biases in the conclusions (Murphy & Katz, 2019). For example, a person gather’s some data from the social media regarding a product and finds that the product is liked by people. Based on the data, he decides that this type of product is usually liked by people and starts producing similar types of products. This type of conclusion might not be valid because the person has neither collected sufficient amount of data and nor does he has aligned his findings with the common beliefs related to those types of products. In such cases, the application of ladder of inference guides the inferential process and helps drawing logical conclusion (Punton, Vogel & Lloyd, 2016). In such cases, if the person collects sufficient amount of data regarding a product and tries to find out the reasons behind people’s liking for the product and align the findings with common theories of customer perception, it might becomes easier for the person to draw logical conclusion regarding the production of specific types of products.
As the ladder of inference helps drawing better and unbiased conclusions, it can be said that ladder of inference can also be considered as a guiding tool for inventions. For this reason, ladder of inference can also be used for making business decisions. Business owners, entrepreneurs and managers often collect data relevant data from contemporary business environment and align them with their own situations, plans and business objectives for taking business decisions. In this context, it is also important to apply relevant theories and models to those decisions in order to analyze their effectiveness. As argued by Padilla et al. (2018), the application of ladder of inference is relevant to decision making because it provide equal importance to existing theories, real-life experiences, collected data and innovative ideas of the thinker. For this reason, the theory of ladder of inference is still considered as an important framework for decision making in business and other areas of life. Effective use of ladder of inference also helps interpreting complex data. Therefore, in the modern age also, the theory of ladder of inference is often used for interpreting market data so that marketing professionals can develop effective marketing strategies.
As per the point of view of Sithembiso & du Plessis (2020), ladder of inference is an effective tool that helps interpreting the consequences of a decision also. For example, the manager of a business organization implements some changes in the work procedures and work schedules and after some days he finds that the employee turnover has increased in the organization and the profitability of the organization has been reduced. The person chooses to find out the reason behind the increase of employee turnover. After that, he tries to gather some data regarding the reasons behind the increase of employee turnover and selects specific data like increase of work pressure, team conflict, low engagement, psychological issues and other relevant data which can be considered as the negative consequences of the previous initiative. These are also considered as interpreted reality according to the theory of ladder of inference. The person makes assumptions that this type of initiative can affect employee satisfaction and can be the major reason behind the increase of employee turnover. Further, the assumption is aligned with existing theories of HR management and then decides to modify organizational policies.
According to Schlegel & Parascando (2020), as ladder of inference helps a person to understand the thinking process, in some cases it can also be used to analyze the decision making process of other people. As a result of it, ladder of inference is also used as a tool for the consultants and the entrepreneurs for understanding the decision making process of the stakeholders. Business consultants can usually identify the priorities of the clients by analyzing the present data regarding existing business issues and the data related to the current business environment. The business consultants can analyze the thinking process of the clients by using the ladder of inference and it becomes easier for them to understand which type of solutions will be preferred by the clients (Ishizaka & Siraj, 2018). On the other hand, analyzing the thinking process of other people is also important in managing team. Considering this fact, it can be said that ladder of inference can be used by team managers of large organization for understanding the mindset of team members and therefore, it can become easier for the team manager to take necessary initiatives for developing suitable relationships with team members.
From the above discussions, it becomes clear that ladder of inference is an important tools for making business decisions these days. Besides all these benefits of ladder of inference for making decisions, there are also some limitations of using ladder of inference for making major decisions. The major limitation of the ladder of inference is ‘reflexive loop’. The theory focuses on selecting specific data from experience and interpreting the data for deriving logical conclusions. However, in studies it has been revealed that people often select data while being strongly driven by their own beliefs. As per the point of view of Gati, Levin & Landman-Tal (2019), it is difficult for human beings to observe everything objectively and therefore, the observers usually see those facts in which they have interests. In such cases, the observers usually focuses on those events which they think to be important as per their own beliefs and therefore, they often fail to observe many important incidents that can help making more logical decision. This issue is called observer bias which cannot be avoided in the process of ladder of inference (Cockburn, 2018). In cases of observer bias, the conclusion is highly influenced by the beliefs of the observer and this might result in bad decisions.
On the contrary, the validity of the decisions taken by using ladder of inference remains largely dependent on the process of data interpretation or the interpretation of reality (Muthukrishna & Henrich, 2019). Different people can interpret different types experience in a different way and therefore, different people take different decisions and act in different way even after they face similar situation. For example, marketing professionals of different companies collect similar types of data from the market regarding the demands of customers and common pricing trends. However, the marketing manager of one organization might want to follow similar pricing strategies for attracting customers while the marketing manager of another company decides to develop innovative products and can adopt an altogether different pricing strategy for gaining a competitive advantage over its rivals. From this perspective, it can be said that following ladder of inference is not enough for making right decision but it is also important to apply an inclusive approach in selecting and interpreting experience or collected data. In case, if the selection of reality and interpretation of those reality are effective enough, then only ladder of inference can ensure logical decision making.
Besides the above limitations, the decisions drawn by using ladder of inference can also be misled by the prisoner’s dilemma. In many cases, the decision makers need to depend on the actions of other people for making proper decision (Gati, Levin & Landman-Tal, 2019). However, it is difficult for people to analyze which actions other people might take in a given situation. Though effective use of ladder of inference can help analyzing the thinking process of other people also, but it is also true that people often thinking a different ways and act in an unpredictable manner (Qin & Liu, 2019). In such cases, the decisions that depend on the actions of other people become uncertain which might result in different types of issues. However, this type of uncertainty is always there in the process of inference and business decision making and it is not at all possible to remove all uncertainties that can affect the validity of inductive reasoning process. From this perspective, it can be said that ladder decisions and other theories of inductive reasoning can help reducing the possibilities of wrong decisions but cannot fully ensure the validity of the inference or made decisions. In this context, ladder of inference teaches the thinks, the basic steps of inferring something accurately but it cannot be denied that inferences are always nearly accurate. The consequences of a decision can be anticipated but cannot be known fully.
In this context, the effectiveness of the theory can also be analyzed by comparing it with other theories and models of decision making that are used by business consultants, entrepreneurs, managers and leaders. As per the assumptions of incremental theory of decision making, people use their previous experiences and activities as the basis of their decision making (Yang et al. 2017). For this reason, they learn from their past mistakes and do not want to repeat mistakes by incrementally increasing decreasing their efforts while doing current activities or taking decisions in the present (Mombini & Tulu, 2020). There is a similarity between incremental theory and ladder of inference that both the theories provide enough importance to collected data and beliefs in the process of decision making. However, the incremental theory is highly focused on past experience and it considers the past experience as the data that serves as the basis for making decisions. On the contrary, ladder of inference provide equal importance to experience, collected data, data interpretation and alignment of findings with existing beliefs. Ladder of inference do not only focuses on decision making for improving w actions but it also helps analyzing the thinking process of other people. Considering this fact, it can be said that ladder of inference can also be used by psychologists as a tool for detecting the psychological of other people.
The ladder of inference has also some similarities with the classical model of decision making. The classical model also suggests making assumptions for defining different aspects of a problem, elimination of uncertainty and collecting full information regarding related incidents and drawing logical conclusions using those data (Beach & Lipshitz, 2017). Like the classical model of decision making, the ladder of inference also suggests analyzing the reasons of exist8ng problem by interpreting data or different aspects of the existing problem. However, ladder of difference cannot help omitting the uncertainties associated with the environment that can affect the process of decision making. For this reason, ladder of inference often lead to issues like observer bias and illusions. Considering these limitations of ladder of inference model, thinkers says that the classical model of decision making is considered to be the most relevant model of decision making in these days because it provides enough importance to elimination of uncertainties that might affect the decision making process (Punton, Vogel & Lloyd, 2016).
Although there are many limitations of the process of decision making using the theory of ladder of inference, it cannot be denied that this is an effective tool for decision making and anyone can use it easily (Beach & Lipshitz, 2017). Many theories related to learning and business decision making can also be influenced from this theory of inference as it provides enough importance to both analyzing own experience and using existing beliefs for taking accurate decisions regarding some issues. Ladder of inference is considered to be the simples and basic method of problem solving (Ishizaka & Siraj, 2018). In this context, the similarities between the theory of problem solving and the ladder of inference. The theory of problem solving focuses on collecting data regarding an existing problem, developing possible solutions and choosing one solution from different alternatives, implementing the solution and evaluating the success of the solution. On the contrary, ladder of inference shows the basic steps of problem solving like data collection, interpretation of data for finding out proper solutions and choosing one solution by using common beliefs associated with the problem (Punton, Vogel & Lloyd, 2016). However, these exclude the final step of evaluating the success of the solution or decision that has been drawn using the ladder of inference.
From the above discussions, it can be said that many of the evolving theories and models of decision making and problem solving has significant similarities and differences with that of the ladder of inference. The evolving theories of decision making and problem solving like the classical model of decision making and the problem solving theory demonstrates a better understanding of the process of decision making for solving some existing issues. On the contrary, the ladder of inference outlines the common process of decision making which can also be used for solving complex issues of life (Padilla et al. 2018). However, like many other theories of decision making and problem solving, the theory of ladder of inference is also dependent on the efficiency of the observers to see realities and interpret those realities logically. Therefore, the chances of observer bias always remain in the process of decision making using this tool.
The essay discusses how the theory of ladder of inference has been founded and gained popularity in the 90s. The essay makes an attempt to analyze the benefits ad limitations using this model as a tool for making logical decisions. For this reason, the theory has been compared and contrasted with other theories of decision making and problem solving. From the above discussions, it can be concluded that ladder of inference is an effective tool that helps people to make logical decisions regarding different areas of life. It is logical process that undergoes in the brain of human beings before deciding something based on experiences. This is a basic theory that guides the thinking process of human beings and therefore, this theory can also be used as a tool for making business decisions, developing strategies and solving specific problems. The consultants can also use this theory in order to understand the thinking process of people so that they can suggest relevant solutions to their clients. The model can also be used as a tool for analyzing the effectiveness of some previous initiatives. However, it has also been revealed in the discussions that the model of ladder of inference also has some limitations as it is dependent on the beliefs of observer and the validity of the data interpretation techniques. Considering this fact, it can be recommended that the decision makers need to choose relevant data and interpret those data using effective methods in order to avoid making wrong decisions using the ladder of inference. Along with that, it is also important to follow a professional and realistic approach for collecting data in order to avoid observer bias.
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