An overview of deductive reasoning

As a corporation or individual, your business should be successful. And one way to achieve business success is to understand the factors that affect your company's bottom line. 

Your market research process should include collecting information about customers' preferences for services and products. Once you gather this information, you can use deductive reasoning to support the logic behind your decisions. 

Deductive reasoning is a logical approach in which you draw conclusions from already-known facts. It usually contrasts with inductive reasoning, in which you use specific observations to arrive at conclusions.

Deductive reasoning is a crucial skill that can help you think logically and make sound decisions for your business. Dive in to learn more about deductive reasoning.

Deductive reasoning is also called top-down reasoning or deductive logic. It is the process of reaching conclusions using premises that are assumed to be true.

In deductive reasoning, you'll likely make an argument from a general statement (hypothesis) and use different premises to reach a conclusion. A premise is a generally accepted fact, idea, or rule. Conclusions are statements supported by those premises.

Here are three examples of deductive reasoning to help better understand this concept:

1. Our high-paying customers are older adults. Because of this, we've decided to focus our marketing strategy on this group.

2. Ten of my clients are unhappy with their experiences. They don't like how long our customer support takes to respond. Therefore, they will be happier if we provide a swift response.

3. My employer says the best sales staff will get a promotion next month. I generated the most sales, so I'm expecting a promotion.

Each of these statements contains two accurate facts and an assumption that relies on those two pieces of information.

The three types of deductive reasoning are syllogism, modus ponens, and modus tollens. Let's take a closer look at them.

Syllogism

Syllogism is the simplest among the three types of deductive reasoning. Here, you draw a conclusion from the truth of two or more premises. It simply states that if A=B (First premise), and C=A (Second premise), then C=B (Conclusion). 

A more creative example would be: all mammals are animals, and dogs are mammals. Therefore, dogs are animals.

Modus ponens

Modus ponens is also known as "affirming the antecedent." In modus ponens, if A is true and A =B, then B is true. For example, customers shop most on Saturdays. Today is Saturday; therefore, customers will shop for more goods today.

Modus tollens

This is the opposite of modus ponens. While modus ponens affirms a conditional statement, modus tollens denies it. It states that if A=B and B is not true, then A is not true. For example, if customers shop most on Saturdays, and customers don't shop for more goods today, then today is not Saturday.

Arguments in logic are also known as premises. Simple deduction logic arguments often require you to reach a conclusion using two premises. It states that if A and B are true, then C must be true. 

Here is an example of a deductive logic argument:

• First premise: All cats have four legs.

• Second premise: Mary's pet is a cat.

• Conclusion: Therefore, Mary's cat has four legs.

For a conclusion to be correct, the hypothesis must be sound. A deductive argument is sound if it is valid and the premises are true, and it is valid if the premises establish the truth of the conclusion. An invalid argument is unsound.

Here is an example of an invalid argument

• All cows eat grass.

• A grasshopper eats grass.

• Therefore, a grasshopper is a cow.

The above statement is invalid because the two premises would not logically result in a true conclusion.

Deductive reasoning concludes by using information that's known to be true. It doesn't include feelings, emotions, or assumptions, since it would be difficult to determine the validity of such information.

In deductive reasoning, you start with general ideas to reach a specific conclusion. Here's how deductive reasoning works:

You use theories to form a hypothesis and observations to test the hypothesis through statistics. Then you utilize your results to make a conclusion.

Deductive reasoning is one of the many mental tools used to make informed decisions in everyday life and business.

You can use deductive reasoning to determine whether certain facts add to a sensible conclusion. You can use it when you want to test new ideas or improve your customer experience.

You can use deductive reasoning in the workplace for the following circumstances:

Solve problems

You can apply deductive reasoning in the workplace to establish a logical solution to an issue affecting the company. To do this, you must first ask questions to identify an accurate assumption that will be the foundation of your deductive reasoning. Then you can test your conclusion.

Settle misunderstandings between workers

Deductive reasoning can also help you settle disputes between employees. You can use it to identify the cause of the problem, make accurate conclusions, and help team members work together. Again, you'll need to collect information from the involved parties and use it to form the premise of your solution.

Address customer issues

Deductive reasoning can come in handy when solving a client's problem. 

Suppose a customer ordered goods and is dissatisfied with your delivery services. You can use deductive reasoning skills to address the customer's problem in the manner below.

1. Clarify the problem (customer isn't satisfied with delivery services)

2. Ask questions to determine why the customer is unhappy (perhaps the order arrived late without prior notice)

3. Use the information received to form two premises (1. The customer isn't happy; 2. The customer is dissatisfied because the goods arrived late)

4. Deduce the necessary conclusions and provide a solution to increase customer experience and satisfaction, such as "customers will be happier if the shipping and logistics teams eliminate shipping delays and communicate more clearly"

Deductive reasoning is commonly applied in research, especially in quantitative research. It involves developing hypotheses or a hypothesis from an available theory and researching to test the hypothesis.

There's a term in research called the hypothetico-deductive (HD) method. It's the scientific method of testing a hypothesis to assess if real-world data support your predictions.

Let's say your website is slow, leading to user frustration and a high churn rate. Here are steps to carry out the deductive research to determine a solution:

1. Choose a research problem and develop a problem statement  The website is slow, leading to a high churn rate.

2. Establish a falsified hypothesis The main hypothesis would be that increasing your website speed will enhance customer experience and reduce churn rate. But your null hypothesis will state that there will be no significant difference in churn rate before and after the modifications.

3. Use appropriate measures to collect data You can use data analytics to determine the number of customers that undertake meaningful activities on the site before and after the change.

4. Evaluate and test the data Through analyzing the data, you observe an 80% improvement in customer retention after the change, resulting in a faster web experience. You note that this change is also statistically significant.

5. Decide if you should discard your null hypothesis Having observed a  significant difference, you can reject your null hypothesis and conclude that your results support your main hypothesis, i.e., that a faster website will reduce customer churn.

Note that you should falsify your hypothesis, or else you'll find it difficult to determine if your results support it.

Deductive reasoning enables you to use logic to justify business-related decisions. Even though the decision might not work out, you'll be able to explain the reason for your actions.

It also enables you to make informed decisions.

For instance, a sales manager might realize that customers buy product A more than product B. The manager decides to inform the production unit to produce a larger quantity of product A and less of product B. Over the months, the company maintains a steady inventory, and there's no lost production.

Deductive problem-solving doesn't leave room for uncertainty. Thus, it reduces guesswork, leading to fewer errors and better solutions.

Deductive conclusions are valid once the premises are valid/ true.

However, though deductive reasoning may seem like a reliable form of testing, it could lead to a false conclusion. This usually happens when the first premise is false. You can also reach an accurate conclusion even when one or all premises are false.

Inductive reasoning is a logical approach used to draw generalized conclusions from specific ideas. It is the opposite of deductive reasoning, in which you use general information to reach specific conclusions, by generating a hypothesis or theory. 

In inductive reasoning, the conclusion is not always true but is probable, regardless of the accuracy of the premises.

People typically use inductive reasoning in everyday situations. Here are some examples of inductive reasoning:

• Specific observation: Baby Ella started crawling at six months.

• Pattern recognition: All babies I've seen crawl at six months.

• General conclusion: All babies crawl at the age of six months.*

Note, while logically sound, the above argument highlights the limitations of inductive reasoning in that relying solely on available data to draw conclusions (i.e., your personal experiences with the ages at which babies crawl) can lead to false conclusions. Not all babies can or do crawl at six months.

A more business-centric example might be when you observe that discounting the price of an item increases its sales, and then you evaluate data to confirm this. Once you discover a pattern, you can establish a theory based on this fact (i.e., product sales will always increase when they are discounted). 

Again, however, this may not always be the case. For example, consumers may avoid products they see as overly cheap as it may raise concerns about product quality

Most research projects involve deductive and inductive methods. Both methods have a premise and conclusion and can help you use logic to solve issues. But they use a different approach to reach conclusions.

The deductive reasoning process involves:

1.  First premise

2.  Second premise

3.  Testing

4.  Conclusion

Deductive reasoning enables you to take facts from one or more statements and develop a logically sound evaluation. Understanding deductive reasoning can assist you in applying logic to solve business-related challenges.