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We sometimes forget the benefits of logic that can provide a framework for problem-solving and innovation. Logic encourages you to think critically, explore alternative approaches, and uncover new opportunities for growth and innovation in your business.
Logic helps you assess risks objectively, evaluate their potential impact, and devise risk mitigation strategies. In contrast relying solely on emotions can cloud your judgment.
A popular but significant contradiction to logic is the lottery. It does generate over $70 billion of betting annually and the states do keep about 1/3 of that. However, Let’s start with the advertisements that you can win hundreds of millions or even a billion dollars. The actual payment is about 1/3 of that after taxes and cash value. The odds of winning are almost impossible and a big winner is drawn only every few months. They promote the lottery based on funding school systems and yet only a small amount is available and it is frequently diverted to other state expenses. One of the worst features is that it is disproportionately played by the poor so it is simply another tax. Finally, a significant number of winners spend the money within a few months.
Some positive examples of the need to consider more logic and avoid poor consequences are as follows:
Emotional decision making can lead to distractions and loss of focus, hampering productivity and progress. Logic acts as an anchor, enabling you to stay focused and disciplined in pursuing your business objectives. By balancing emotions with logic, you tap into a powerful combination that fuels productivity, decision-making, and progress in your business.
Safety exemplifies the use of logic to be a core part of your programs rather than an afterthought. The most important aspect of safety is prevention. Car seats, not drinking while driving, not smoking, training, and inspections have saved numerous accidents. In addition to prevention creating a culture of safety is critical to success. A critical part of that culture is training to both avoid and manage accidents. Similarly, both physical tools like fire extinguishers and skills like accident training and artificial respiration can dramatically reduce the impact of events.
Understanding parameters is a critical aspect of logic. Currently the impact of the pandemic should be a critical aspect of your decision making. For example, much analysis is based on 3 ,5, and 10-year histories. The pandemic requires that we consider the impact of 2020, 2021 and 2022 on our data. For example, the stock market appears up about 15-20% this year. However, in general it is not even back to 2021 levels. Similarly, we are seeing lots of political data about the 2024 elections. However, the definition of the data in terms of party, region, age etc. can have a profound impact on the apparent results.
We frequently avoid the logic of understanding interaction of value, probability and risk. For example, entrepreneurs frequently fail to consider that 90 % of new businesses fail within 5 years. As a result, they also fail to consider mitigating solutions like alternatives, tests, and measurement. Finally, while many programs have the potential to justify the excitement, entrepreneurs need to always assess the risk and real potential.
Evaluating the logic of your programs also enables the consideration of more issues and alternatives. Have you considered priorities, other scenarios and potential challenges. In particular the evaluation of alternative efforts and consequences can add to the effectiveness of a project.
Logic can be misleading. In particular the structure or form the argument can be wrong. A most common example is implying cause and effect when it is not real. Similarly, small samples can be misleading in predicting results. Unless the coin is biased the next coin flip is independent of the last one. This frequently happens in forecasting where the wrong variables are credited with causing results. Logic can also just be wrong. Bias, wrong data, using history and highly charged presentations are examples. Sports betting is almost always fueled by poor logic.
In summary, don’t let the excitement and potential of new projects interfere with basic logic. Logical thinking helps you prioritize tasks, set realistic goals, and maintain a structured approach, allowing you to maximize your efficiency and accomplish more in your business. If considered properly it should not disrupt innovation and intuition.
Related: Six Ways To Improve Goal Setting