Critical Thinking Steps - Essay Example

?Critical Thinking Steps The paper utilizes the multi-step methodology that was developed by Browne and Keeley in the book ‘Asking the right questions’ for the purposes of analyzing the PDQ memo. This memo is a confidential piece of communication that comes from the senior vice president, Human Resources, and goes to the Chairman of the board of directors for executive compensation. The steps developed by Browne and Keeley (2012) will thus be utilized for evaluating the author’s arguments. The steps were analyzed in answering the following questions regarding the memo. 1. What Are The Issues And The Conclusion? According to Brown and Keeley (p. 19), an issue can be described as a question or a controversy that is responsible for a conversation or discussion that is taking place. It can further be described as the stimulus for whatever that the communicating parties are saying (Brown and Keeley, p. 19). The authors suggest that there are basically two types of issues namely the prescriptive and descriptive issues. The descriptive issues refer to issues that raise controversies or questions concerning past, present or future descriptions. On the other hand, prescriptive issues have been described as those issues which issues that raise concerns as to what is wrong or right. The case in the PDQ memo is a descriptive issue since the PDQ memo expressly states that “Specifically, the question is whether the compensation level for PDQ’s CEO is appropriate to the position with respect to current industry standards” (Mark Headlee, personal communication, October 1,2011 ). This clearly shows that the issue in the memo questions whether it is right to pay the sum provided for the CEO after considering the current standards in that industry. According to Brown and Keeley (p.21), a conclusion can be described as the message that speaker or author wants you to accept as viable. The PDQ memo concludes by saying that, “ Our finding is that the compensation of the chief executive is not appropriate to the current industry standards for a company the size of PDQ because it is maligned” (Mark Headlee, personal communication, October 1, 2011). 2. What Are The Reasons? According to the authors Brown and Keeley (p.41), a reason can be defined as an explanation or rationale for believing in a particular conclusion. They additionally state that an argument comprises of a conclusion and the reason for supporting it. From the PDQ memo, the chief executive does not deserve compensation as it is not appropriate to their current standards in their industry and for a company of their size because they have been misaligned. The reasons provided are noted in a recent academic article found in the Baltimore Sun as the excessive pays give to chief executives have brought about events such as the recent recession (Baltimore Sun, personal communication, October 1,2011). Other reasons that have been provided for not increasing the chief executives compensation are that if the CEO such as Raymond James is wealthy there is no need for overpaying him for performance (Wharton School of management, personal communication, October 1,2011). 3. What Words Or Phrases Are Ambiguous? According to the authors Brown and Keeley, the term ambiguous refers to a situation where there exists multiple meanings for a word or phrase found in an article. From the PDQ memo, the phrase “Is CEO pay too high and are the incentives too low” is ambiguous. This is because some two professors from the Wharton School of management present the argument that when a company’s board is setting their CEO’s pay, they should greatly put into consideration his personal wealth level. They alternatively say that it means that if a CEO is wealthy then it would be unnecessary to overpay the CEO for his performances. However, in the Best practices section of the PDQ memo, it is stated that “the most efficient compensation method is the pay for performance method (Mark Headlee, personal communication, October 1, 2011). This clearly creates an ambiguous situation since a CEO might be wealthy and still efficient in delivery the desired results. This situation leaves the reader confused over which method to use in compensating a CEO in such a situation. 4. What Are The Value And Descriptive Assumptions? From the book by Brown and Keeley, values have been described as unstated ideas that people involved in a particular situation see as being worthwhile. They additionally describe the standards of conduct through which human behavior is measured (p.10). The PDQ memo states that the people who work in the Human Resource Departments do believe that “Pay for performance” is the most effective compensation method (Mark Headlee, personal communication, October 1, 2011). According to Brown and Keeley, a descriptive assumption has been described as unstated beliefs about how the world is, was or will become (p.66). From the PDQ memo’s conclusion, the office of the chair of board of directors hopes that “the successor will be more hardworking and willing to do what is necessary to return the PDQ to the greatness that it knew under the exemplary leadership of the company’s founder” (Mark Headlee, personal communication, October 1, 2011). Additionally, the authors Brown and Keeley have described value assumptions as implicit preferences for a value over another within a particular context. From the PDQ memo, it is implicit that the company directors prefers to compensate their CEO by offering him $400,000 as opposed to their industry’s standard of $391,659 without including the increments presented to him during the next two years of his employment (Mark Headlee, personal communication, October 1, 2011). 5. Are There Any Fallacies In The Reasoning? According to the authors Brown and Keeley, a fallacy in reasoning can be described as a trick that an author may utilize while trying to persuade the reader into accepting the conclusion he has given in his work (p.74). From the PDQ memo, several forms of fallacies have been depicted. The author uses a fallacy Ad Hominem in attacking the personality and personal wealth of Raymond James and using this excuse to show the reader that the CEO does not deserve an increment in his compensation. He uses this excuse to also evade the issue under discussion and to justify his conclusion that the CEO’s compensation is not appropriate to the current industry standards of a company its size (Mark Headlee, personal communication, October 1, 2011). The authors have also utilized a fallacy by appealing to emotions by suggesting that hopefully the successor to the current CEO “will be more hardworking and willing to do what is necessary to return PDQ to the greatness that it knew under the exemplary leadership of the company’s founder (Mark Headlee, personal communication, October 1, 2011). The memo’s author has also utilized a fallacy of appealing to questionable authorities when referring to the flyers being circulated at the Hawthorne and Lakeside facilities that are entitled’ Overthrow the tyrant King James’. The flyers used have a comic representation of a giant wearing a crown that happens to be the company’s CEO who seems to be crushing PDQ’s hourly workers under his feet (Mark Headlee, personal communication, October 1, 2011). 6. How good is the evidence? The authors Brown and Keeley defined evidence as explicit information that is shared by the communicator and is used for justifying the dependability of factual claims. In a prescriptive argument, evidence is required for the purpose of supporting any reasons that are factual claims made. On the other hand, in descriptive arguments, evidence is required for the purpose of directly supporting a descriptive conclusion adopted (p.95). The major kinds of evidence availed include intuition, personal experiences, testimonials, case studies, personal observations, analogies, research studies and appeals to specialists. The PDQ memo provides a descriptive conclusion and provides fallacies in hastily generalizing the fact proposed by two professors from Wharton school of management. They proposed that if a company’s CEO is sufficiently wealthy, it should not be necessary to overpay the CEO for performance (Mark Headlee, personal communication, October 1, 2011). The author generalizes this fact from the perception of the CEO being discussed, Raymond James, to include all the other CEO’s even beyond their industry. This fallacies are all being implemented for urging the reader to accept his proposed conclusions. This fallacy is wrong since generalizations can only be made to people along with events that are similar to those previously studied in a research. 7. Are There Rival Causes? From the book by Brown and Keeley, rival causes are plausible alternative explanations that can be used in explaining why a certain outcome has happened (p.128). The PDQ memo has utilized a fallacy of causal oversimplification by laying excessive emphasis on the role of the CEO’s wealth in denying his an increment in his compensation. The memo also creates a post hoc fallacy by suggesting that it is the performance of a CEO which should dictate his compensation increments (Mark Headlee, personal communication, October 1, 2011). This is not true since there are factors that determine the issue in question such as his employment contract which stated his starting salary as $400,000 with increments in the next few years notwithstanding the company’s performance. 8. Are the statistics deceptive? The authors Brown and Keeley suggest that statistics do sometimes lie and do not necessarily seem what they appear to be. The salary increases provided in the PDQ memo do not necessarily have to be true because the CEO gets increments when the company is experiencing negative growth rates. This implies that the statistics could most likely be false since the same office that denies the CEO an increase seemed to have approved his increments when their company was flopping (Mark Headlee, personal communication, October 1, 2011). The office in charge of compensations advocates for remunerating their CEO based on his performances. However, in the statistics provided, they have increased his pay despite the company’s performance declining throughout the years the CEO has been in charge. The salary offered to their CEO grows by 48% in a seven year period spanning from 2003 to 2009 though their company’s overall growth is only estimated at about 3% (Mark Headlee, personal communication, October 1, 2011). This increments do not seem to be realistic when compared to the performance of their company. 9. What significant information has been omitted? The significant information that has been omitted is the information that shapes the reasoning. The PDQ memo states that the exorbitant salaries offered to various CEO’s resulted into the global financial crisis (Mark Headlee, personal communication, October 1, 2011). It does not however expound on how their salaries caused the global recession even when some of the companies were making profits. The PDQ memo also states that the company’s CEO is a wealthy man who does not have to be overpaid for his performances. The memo does not quantify his wealth neither does it give us an estimate of what he is worth. The committees interpretation of his riches could be wrong and overstated since they have provided no details concerning his actual worth for the reader to judge for himself or herself. It additionally claims that the CEO has no incentives of working at all but does not expound on the reasons why he does not have any (Mark Headlee, personal communication, October 1, 2011). This could be a claim against him by his rivals since it has not been substantiated with evidence to the claim. The long-term effect of the actions is that they could bring leadership wrangles in the company since the board of directors does not reveal all necessary information concerning various situations. This could eventually result in a decline in the company’s growth and performances in the market. 10. What reasonable conclusions are possible? The board should adopt the policy of increasing their CEO’s compensation based on his performances. This will eventually help the company not to incur losses when their growth is declining due to the increments made to the CEO’s compensation. They should also avoid offering increments to a CEO in his employment contract since it binds the company to his terms despite his poor performance. Reference Brown, N. M. and Keeley, S. M., 2012, Asking the Right Questions: A Guide to Critical Thinking, Upper Saddle River, New Jersey. Read More