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STRATEGY & ANALYSIS EDUCATION SERIES

The Four Kinds of Logical Reasoning

Welcome to the ninth lesson in Cipher’s Strategy & Analysis Education Series. In every lesson, we’ll cover a key framework or methodology used by leading strategy consultants.

In solving any problem, there are four kinds of logic we can employ. Today, we’ll explore which forms of logical reasoning are best suited to strategic thinking.

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Deductive Reasoning

Applies general rules to specific cases, giving 100% certainty.

Inductive Reasoning

Applies specific rules to general cases, giving <100% certainty.

Converse Logic

A process of elimination to arrive at a logical conclusion.

Reverse Logic

Starts with a conclusion, then identifies assumptions that must be met.

About the Four Kinds of Logical Reasoning

There are four key ways we humans apply logic to solve problems. But when it comes to solving complex strategic issues, some approaches are better than others. Let’s explore the four approaches:

Deductive Reasoning: Start out with a general statement, and examine whether this holds true for a specific scenario. Example: All humans are mortal. John is a human. Therefore, John is mortal. 

Inductive Reasoning: Making generalized conclusions based on specific examples. Example: John pulls a coin out of a bag. It’s a penny. Therefore, all coins in the bag must be pennies. This kind of reasoning often leads to errors and should not be used in business strategy.

Converse Logic: Eliminate possible solutions to the problem by analyzing potential outcomes, then arrive at the outcome that has the highest likelihood. Converse logic can often lead to false statements. Example: If it snows, school is cancelled. Converse: if school is cancelled, it snows.

Reverse Logic: Begin with a conclusion, and identify the underlying conditions that must hold true for the conclusion to be logical. This is the most helpful logic for strategic planning. Example: what conditions must hold true for a competitor to launch a new product? They must hire new leaders, innovate new technology, and reach new distribution channels.

 

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Your Next Steps

Yes, we are actually assigning you homework! Now that you've learned about this, your next steps are to...

Step 1

Do a team exercise to practice dissecting arguments in each of the four ways.

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Step 2

Select an argument to dissect. Then have the team work through each type of logical reasoning to dissect that same argument four times.

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