What is Critical Thinking?

Updated October 2026 · reviewed for today

In short

Critical thinking is careful, reasoned judgement about what to believe or do, based on the evidence and the grounds behind a claim. The American philosopher John Dewey set it out as an educational goal in How We Think (1910), where he more often called it reflective thinking: “active, persistent and careful consideration of any belief or supposed form of knowledge in the light of the grounds that support it, and the further conclusions to which it tends”.

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How it works

01

Clarify the claim

Restate the question or claim precisely, including its terms and scope.

02

Weigh the grounds

Ask what supports it, where that evidence comes from and how reliable the sources are.

03

Test alternatives

Look for other explanations, counter-evidence and the assumptions you are making.

04

Reach a proportionate judgement

Hold the conclusion with confidence that matches the evidence, and be ready to revise it.

Where you see it today

Working with generative AI

A survey of knowledge workers found that higher confidence in generative AI was associated with less critical thinking on AI-assisted tasks, while higher confidence in one’s own ability was associated with more (Lee et al., 2025). The data are self-reported, but the pattern is a warning: trust in the tool can quietly replace checking.

Reading laterally

In a study comparing historians, professional fact checkers and university students evaluating websites, fact checkers left a site quickly and opened new tabs to see what others said about it. They reached better-founded conclusions in a fraction of the time (Wineburg and McGrew, 2019). The same move works for AI answers: check claims outside the chat.

Checking AI citations and numbers

Language models can produce fluent answers with sources or figures that do not hold up. Opening the cited source and finding the claim in it is the most basic critical-thinking step in AI-assisted work.

Decisions in companies

Pre-mortems, red teams and written assumptions are critical thinking built into process. They matter more when AI makes it cheap to produce persuasive memos for any position.

Critical thinking vs related ideas

Critical thinking

FocusJudging claims by their grounds

Typical question"What is the evidence, and is it good?"

Socratic method

FocusProbing through questions

Typical question"What do you mean by that?"

First-principles thinking

FocusRebuilding from basic truths

Typical question"What do we know for certain here?"

Lateral thinking

FocusGenerating new options

Typical question"What if we did the opposite?"

Metacognition

FocusAwareness of one's own thinking

Typical question"Why am I confident about this?"

How to use it

• Before accepting an AI answer that matters, open at least one cited source and find the claim in it.
• Write the question down precisely before you search or prompt; vague questions get confident, vague answers.
• Read laterally: check what independent sources say about a claim or a website, not only what it says about itself.
• For every important decision, list the assumption that, if wrong, would change it.
• Ask an AI assistant for the strongest counter-argument to your conclusion, then judge whether it holds.

The Business Engineer lens

AI makes fluent answers cheap, so the scarce skill shifts to asking good questions and checking what comes back. The Business Engineer treats critical thinking as an operating system for working with AI, not as a soft skill.

Read: The Business Engineer Thinking OS →Explore the platform →

Related: Socratic method · First principles thinking · Confirmation bias · Metacognition · Second-order thinking

Frequently asked questions

What is critical thinking?

It is careful, reasoned judgement about what to believe or do, based on evaluating the evidence and reasons behind a claim.

Who defined critical thinking?

John Dewey set it out as an educational goal in How We Think (1910), calling it reflective thinking; many later philosophers and educators have refined the definition.

Does using AI weaken critical thinking?

Research is early; one survey of knowledge workers found that people with more confidence in AI reported less critical thinking on AI-assisted tasks.

How can I improve my critical thinking?

Practise clarifying questions, checking sources independently, looking for alternative explanations and stating what evidence would change your mind.

Sources

• Hitchcock, Critical Thinking, Stanford Encyclopedia of Philosophy
• Dewey (1910), How We Think, Project Gutenberg
• Lee et al. (2025), The Impact of Generative AI on Critical Thinking, CHI 2025 (Microsoft Research)
• Wineburg and McGrew (2019), Lateral Reading and the Nature of Expertise, Teachers College Record

The full guide

The complete explainer, cleaned up and reformatted for mobile.

Critical thinking involves analyzing observations, facts, evidence, and arguments to form a judgment about what someone reads, hears, says, or writes.

Understanding critical thinking

Critical thinking is a practice that has been debated and honed for around 2,500 years, but the term itself was likely first introduced in 1910 by American philosopher, psychologist, and educational reformer John Dewey.

In his book How We Think, Dewey described critical thinking as an “active, persistent, and careful consideration of a belief or supposed form of knowledge in the light of the grounds which support it and the furthest conclusions to which it ends.”

Dewey also wrote his book to help readers take inspiration from the natural curiosity, fertile imagination, and love for experimentation that many children possess.

Richard Paul and Michael Scriven’s definition from the 8^th Annual International Conference on Critical Thinking and Education Reform in 1987 is also worth a mention.

Paul and Scriven considered critical thinking to be an intellectually disciplined process where information was actively and skilfully conceptualized, analyzed, applied, synthesized, and evaluated.

This information – gathered from observation, reflection, experience, reasoning, or communication – forms the basis of one’s actions and beliefs.

In its pure form, Paul and Scriven argued that critical thinking was “based on universal intellectual values that transcend subject matter divisions: clarity, accuracy, precision, consistency, relevance, sound evidence, good reasons, depth, breadth, and fairness.”

The qualities of a critical thinker

At the core of every critical thinker is the ability to be an active learner who questions ideas and assumptions rather than simply accepting them at face value.

That is, they are not passive recipients of information and will always strive to ensure that the information present best represents the bigger picture. 

To that end, the critical thinker can

• Determine the relative importance of different ideas, arguments, or facts.
• Identify reasoning errors or inconsistencies.
• Tackle problems in a systematic fashion.
• Easily understand the link between ideas. 
• Build, recognize, or appraise arguments.
• Critically reflect on their own assumptions, beliefs, and values to learn from past experiences and improve in the future, and
• Substantiate and communicate their reasoning to others.

Critical thinking skills that are important in business

Here are just five critical thinking skills that are important in business:

Evaluation of alternatives

Successful businesspeople can accurately evaluate a list of options and establish priorities.

They can also determine the quality of each alternative and, as we touched on earlier, explain the rationale behind their decisions.

Decision-making in precise contexts

Critical thinkers use deductive reasoning to anticipate outcomes and predict logical consequences.

They use this skill to consider the implications of directives, policies, and regulations.

Decision-making in ambiguous contexts

Conversely, critical thinkers use inductive reasoning to make decisions in circumstances that are ambiguous, uncertain, or risky.

These decisions are the ones most likely to succeed given the available information.

Problem analysis

Where the individual can identify the key components of a complex problem and then address it with robust analysis and interpretation skills.

Decision-making in quantitative contexts

Data analysis is synonymous with business success.

Strong critical thinkers can interpret and evaluate data across numerous different formats to solve a problem in the most efficient way.

When and How to Apply Critical Thinking

Critical thinking is applicable in various contexts

1. Education: It is fundamental in promoting intellectual growth, fostering analytical skills, and nurturing lifelong learning.
2. Problem-Solving: Critical thinking helps identify the root causes of problems and develop effective solutions.
3. Decision-Making: It aids in evaluating options, weighing pros and cons, and making sound decisions.
4. Research: Critical thinking is essential in conducting rigorous and credible research by assessing sources and drawing valid conclusions.
5. Media Literacy: It is valuable for discerning credible information from misinformation or bias in media and online sources.

To foster critical thinking

1. Question Assumptions: Challenge assumptions and conventional wisdom.
2. Seek Diverse Perspectives: Consider different viewpoints and gather a variety of information sources.
3. Practice Reflection: Regularly reflect on your thoughts, decisions, and actions.
4. Engage in Socratic Dialogue: Encourage open and constructive dialogue to explore ideas deeply.
5. Develop Problem-Solving Skills: Enhance your ability to solve complex problems systematically.

Benefits of Critical Thinking

Critical thinking offers numerous benefits

1. Better Decision-Making: It leads to informed, rational, and well-considered decisions.
2. Effective Problem-Solving: Critical thinkers are adept at identifying, analyzing, and solving complex problems.
3. Enhanced Communication: It improves the ability to express ideas clearly and persuasively.
4. Improved Judgment: Critical thinking enables individuals to assess situations with greater accuracy.
5. Lifelong Learning: It promotes a continuous quest for knowledge and self-improvement.

Potential Limitations of Critical Thinking

Despite its advantages, critical thinking may have limitations

• Time-Consuming: It can be time-intensive, especially in situations requiring quick decisions.
• Emotionally Draining: Constantly questioning and analyzing can be emotionally taxing.
• Cognitive Bias: Even critical thinkers may be susceptible to cognitive biases that influence judgment.
• Information Overload: In today’s information-rich world, it can be challenging to sift through vast amounts of data.

Critical thinking examples

To conclude this piece on critical thinking, we’ll describe a few of the ways it may be useful in business today.

Risk assessment

In finance, wealth management firms must routinely evaluate new legislation to determine whether it will affect their ability to deliver client returns.

This requires careful analysis of the data, problem-solving (determining how the firm can work around the new legislation), and creativity (open-mindedness to the various scenarios or outcomes that could impact operations and client satisfaction). 

In this context, critical thinking is key to turning a profit and avoiding compliance issues.

Recruitment 

The objectivity of critical thinking is also crucial during the recruitment process.

Now more than ever, HR departments must be able to analyze hundreds or even thousands of applications to select the best candidate. 

Objectivity means the firm does not favor a certain candidate because of their age, gender, race, connection with another employee, or any other factor.

Critical thinking plays a key role here since confirmation bias is sometimes unconscious and can prevent the organization from recruiting the best talent.

Collaboration and problem-solving

Critical thinking is also important in team-based problem-solving which invariably includes some form of brainstorming or ideation. 

Organizational teams that employ critical thinking first encourage all team members to contribute and then analyze their input in a logical and constructive way.

The most effective teams recognize any weaknesses or negative points in a colleague’s argument and use evidence to support their assertions.

Customer Service Improvement

A customer service team is faced with a high number of customer complaints about a specific product feature.

To address the issue, they use critical thinking to analyze the feedback, identify patterns and root causes of the problem.

By examining the data, they can develop targeted solutions to improve the product and enhance customer satisfaction.

Marketing Campaign Analysis

A marketing team launches a new advertising campaign for a product, but sales don’t meet expectations.

They use critical thinking to review the campaign’s performance, analyzing consumer feedback, market trends, and competitor activities.

By identifying the strengths and weaknesses of the campaign, they can make data-driven adjustments to maximize its effectiveness.

Supply Chain Optimization

In a manufacturing company, the supply chain — as explored in how AI is restructuring the traditional value chain — team uses critical thinking to optimize inventory management.

They analyze historical sales data, production schedules, and lead times to identify areas where inventory levels can be reduced without affecting customer service.

Through careful analysis, they can streamline the supply chain and reduce costs.

Negotiation Strategies

In a business negotiation, critical thinking is vital to analyze the other party’s interests, motivations, and potential leverage points.

By understanding the underlying factors, negotiators can develop effective strategies to achieve mutually beneficial outcomes.

Financial Decision-Making

A CFO uses critical thinking to evaluate potential investments and financial strategies.

They analyze financial statements, market conditions, and economic trends to make informed decisions about capital allocation and financial planning.

Crisis Management

During a crisis or emergency, leaders employ critical thinking to assess the situation, identify immediate risks, and develop response plans.

They must act quickly and decisively based on available information to mitigate the impact of the crisis.

Product Development

In a technology company, product managers use critical thinking to identify market gaps and opportunities for new product development.

They analyze customer feedback, competitor products, and technological advancements to create innovative solutions that meet customer needs.

Business Expansion

A company is considering expanding its operations to a new market.

Critical thinking is essential in conducting market research, assessing regulatory environments, and analyzing potential risks and rewards.

Through careful analysis, they can make informed decisions about market entry strategies.

Conflict Resolution

In a team environment, critical thinking is used to resolve conflicts and disagreements.

Team members analyze the underlying causes of conflicts and work together to find constructive solutions that promote collaboration and harmony.

Ethical Decision-Making

In a corporate setting, leaders use critical thinking to navigate ethical dilemmas.

They analyze the potential consequences of their decisions on stakeholders, consider ethical principles, and make choices that align with the company’s values.

Continuous Improvement

A company adopts a culture of continuous improvement, encouraging employees to use critical thinking to identify areas for efficiency gains and process optimization.

Through data analysis and problem-solving, employees contribute to ongoing improvement initiatives.

Asking the right questions

Critical thinkers also understand the importance of asking the right questions to arrive at the most accurate conclusion.

Some of the questions that encourage an active line of inquiry include:

Outcome-based questions

When an employee feels they could benefit from the skills or experience of a co-worker, outcome-based questions are ideal.

When someone is asked how they would act in a certain situation, the employee may learn new perspectives or possibilities. 

Structural questions

These questions deal with processes or systems and how they function.

Since processes and systems have been honed over time via trial and error, structural questions reveal efficiencies that can be applied to one’s own endeavors. 

Reflective questions

To develop critical thinking skills based on real-world scenarios, employees can ask someone to reflect on an experience and explain their thought processes at the time.

Open-ended questions

These questions encourage longer, more detailed answers that are more likely to provide useful or relevant insights.

Case Studies

1. NASA's Apollo 13 Mission

• Scenario: During the Apollo 13 mission to the Moon, an oxygen tank exploded, causing a life-threatening crisis. NASA engineers and astronauts had to engage in critical thinking to troubleshoot and devise a solution to safely return the crew to Earth.

2. Toyota's Production System

• Scenario: Toyota’s innovative production system emphasizes continuous improvement and problem-solving. Employees at all levels are encouraged to engage in critical thinking to identify and address production issues, leading to high-quality and efficient manufacturing processes.

3. Financial Investment Analysis

• Scenario: Investment professionals apply critical thinking when analyzing financial markets and investment opportunities. They evaluate economic data, company financials, and market trends to make informed investment decisions.

4. Medical Diagnosis and Treatment

• Scenario: Healthcare professionals, such as doctors and nurses, employ critical thinking when diagnosing illnesses and determining treatment plans. They gather patient history, analyze symptoms, and consider medical research to make accurate decisions.

5. Legal Case Analysis

• Scenario: Lawyers and legal professionals use critical thinking to analyze complex legal cases. They assess evidence, review case law, and develop persuasive arguments to advocate for their clients in court.

6. Environmental Policy Decision-Making

• Scenario: Government agencies and environmental organizations engage in critical thinking when crafting policies to address environmental issues. They consider scientific research, economic implications, and societal concerns to develop effective policies.

7. Technology Product Development

• Scenario: Technology companies apply critical thinking when designing and developing new products. Engineers and designers evaluate user needs, technical feasibility, and market competition to create innovative solutions.

8. Crisis Management and Public Relations

• Scenario: Companies facing crises, such as product recalls or public relations scandals, rely on critical thinking to navigate the situation. They assess the impact, develop communication strategies, and take corrective actions to address the crisis effectively.

9. Social Issues and Advocacy

• Scenario: Advocacy groups and nonprofits use critical thinking to address social issues. They analyze research, policy implications, and public opinion to advocate for change and influence policy decisions.

10. Education and Curriculum Development

• Scenario: Educators and curriculum designers employ critical thinking when developing educational materials and programs. They consider learning objectives, pedagogical methods, and student needs to create effective learning experiences.

Key takeaways

• Critical thinking involves analyzing observations, facts, evidence, and arguments to form a judgment about what someone reads, hears, says, or writes.
• At the core of every critical thinker is the ability to be an active learner who questions ideas and assumptions rather than simply accepting them at face value.
• Critical thinking is an integral part of business. Just a few of the scenarios where it is effective include recruitment, risk assessment, collaborative problem-solving, and question-based learning or research.

Key Highlights

• Definition: Critical thinking involves analyzing observations, facts, evidence, and arguments to make informed judgments about information received from various sources.
• Origin and Definitions: John Dewey introduced the term in 1910 as active, persistent consideration of beliefs. Richard Paul and Michael Scriven defined it as an intellectually disciplined process of analyzing, synthesizing, and evaluating information.
• Qualities of a Critical Thinker: Active learners who question assumptions, analyze information, determine importance, identify reasoning errors, solve problems systematically, understand the links between ideas, build, recognize, or appraise arguments, reflect on assumptions, and communicate reasoning.
• Critical Thinking Skills in Business:
  • Evaluation of Alternatives: Accurately evaluating options and prioritizing based on rationale.
  • Decision-Making in Precise Contexts: Using deductive reasoning to anticipate outcomes.
  • Decision-Making in Ambiguous Contexts: Using inductive reasoning in uncertain situations.
  • Problem Analysis: Identifying complex problem components and analyzing them.
  • Decision-Making in Quantitative Contexts: Interpreting and evaluating data for efficient solutions.
• Examples of Critical Thinking in Business:
  • Risk Assessment: Analyzing legislation impact on wealth management.
  • Recruitment: Using objectivity to select the best candidate.
  • Collaboration and Problem-Solving: Constructively analyzing team contributions.
  • Customer Service Improvement: Analyzing feedback and improving products.
  • Marketing Campaign Analysis: Adjusting campaigns based on data analysis.
  • Supply Chain Optimization: Reducing costs through supply chain analysis.
  • Negotiation Strategies: Analyzing the other party’s interests for better outcomes.
  • Financial Decision-Making: Evaluating investments and strategies.
  • Crisis Management: Assessing crises and developing response plans.
  • Product Development: Identifying market opportunities for new products.
  • Business Expansion: Analyzing risks and rewards for market entry.
  • Conflict Resolution: Using critical thinking to resolve conflicts.
  • Ethical Decision-Making: Navigating ethical dilemmas using analysis.
  • Continuous Improvement: Using data analysis for process optimization.
  • Asking the Right Questions: Using outcome-based, structural, reflective, and open-ended questions for learning and improvement.
• Key Takeaways:
  • Critical thinking involves actively analyzing and evaluating information.
  • A critical thinker questions assumptions and seeks deeper understanding.
  • Critical thinking is crucial in business for decision-making, problem-solving, conflict resolution, and innovation.