This teaching note was adapted from a note prepared for Harvard Business School, Management Communication by Norman Klein, Associate in Communication. EFFECTIVE ARGUMENT This note explores the issues of logic that business writers and speakers deal with when they are called on to argue a position. But first a word on the limits of argument. Persuasion is an ongoing process in an organization and argument is only one aspect of persuasion. Business environments offer many means of persuasion; for example, an individual’s track record and position in the company may influence an audience to accept his or her views. A single presentation rarely resolves all the issues it addresses, and a written document may be just one element in a process of persuasion that includes complementary presentations by others, follow-up memos, email exchanges, hallway conversations, and the like. Moreover, the nature of a particular issue, situation, or even the organization itself may undermine the effectiveness of rational argument, as, for example, when an audience is strongly biased or when an issue provokes strong emotions. Nevertheless, where rational decision-making and objective evaluation are valued, written or oral arguments will be critical to influencing others’ thinking. In these circumstances effective argument is logical argument. Rules of logic underlie the structure of any argument aimed at persuading. These rules are based on the thought process by which humans naturally reason. Broadly speaking, reasoning works one of two ways, which are labeled induction and deduction. Choosing one or the other, based on purpose and audience, is the key to making an argument that is perceived to be rational and convincing. The remainder of this note explains the difference between the two forms of reasoning, why the inductive process is most common in business writing and speaking, and how effectiveness in argument is determined. What is Inductive Argument? Simply put, inductive argument is evidence-based argument. A writer or speaker accumulates a body of specific facts and data, which lead to a general conclusion. The resulting report or presentation states the conclusion and shows the facts and data that support it. The audience is able to see and consider the support for each claim. The following case, of a study by a consulting firm for a business client, reflects inductive reasoning. The background: Sienna Paint and Resins, Inc., a small company with annual revenues of $60 million and total assets of around $130 million, is a leading producer of specialized adhesives. Over the last five years one adhesive used by makers of super-ceramic materials has grown to account for half of Sienna’s income. Because of this, the CEO wondered if his company should be in the ceramics business. His banker has suggested that Sienna might be able to raise as much as $100 million if it wishes to expand. But the consultants hired to assess the feasibility of moving to ceramics produced the following findings, from which they concluded that Sienna should not pursue this venture. 1. Building a small, state-of-the-art plant will cost between $140 and $200 million, which is more than you can comfortably raise. 2. The pace of innovation will require upgrades almost immediately, in the area of $20 to $60 million. 3. Your lack of economies of scale will make production costs almost certainly higher than your competitors’. 4. Depending on the products developed, Sienna may face patent barriers, licensing costs, and high-cost raw materials available only from competing firms. CONCLUSION: Costs of entry are extremely high; given Sienna’s debt capacity, the venture is not recommended. What are the Tests of an Effective Inductive Argument? What makes the above argument effective? The first consideration is a tactical matter related to audience. Because cost is always a relevant issue in business, virtually any cost argument will command interest. But the argument is effective because it passes the three key tests of evidence: 1. The evidence is sufficient – enough to be convincing to the specific audience. 2. All the evidence shares a common category – in this argument, entry costs. 3. The conclusion is consistent with the evidence – does not go beyond the data. Similar to the way that the two forms of reasoning reflect natural thinking processes, the tests of effective argument reflect the questions that naturally arise in the minds of rational audiences. Communicators who ensure that their arguments pass these tests will be more convincing. What is “Enough” Evidence? The above argument is effective because it contains extensive evidence – four distinct and specific items. It avoids the pitfall of diluting the power of the evidence via summarizing. For instance, the consultant’s evidence could be reduced to, “Our research revealed that the total cost of a new plant could run from $140 to $200 million and that other major costs would immediately follow.” In using a generalized summary, a communicator is essentially saying, “Trust me; I have found conclusive evidence.” Readers or listeners are better convinced when they can see the evidence for themselves. Phrases like “other major costs” raise the question of what the other items or services are and how “major” their costs will be. Specific and extensive evidence is a better strategy because it creates or enhances communicator credibility, overcomes existing doubts, answers key questions and readies the audience for a conclusion – not new doubts and questions. Summary arguments are often defended by saying that more detailed and extensive evidence is available in the appendix. The problem with this defense is that it forces audiences to (1) search through an evidence pile; (2) locate and sort the useful pieces; and (3) construct the arguments themselves. Another defense is that there is not enough time or space to include detailed evidence. Again, this leaves readers and listeners with insufficient information to evaluate the argument on its own. Strategic selection of the critical evidence – separating all that could be said from that which will be most convincing to the given audience – is the key to solving this problem. Why the “Common Category” Test? Again, the “common category” rule reflects the way the human mind makes sense of information: by automatically imposing order on it and seeking a logical pattern to it. The mind naturally groups together things that are similar to one another. When a writer or speaker creates groupings for an audience the message is easy to absorb and perceived as logical. If one piece of evidence does not seem to share fundamental characteristics with other evidence, it sticks out as illogical, as not “following” the pattern. Had the Sienna consultants added a fifth fact to the entry costs argument – the fact that Sienna will be negotiating a major union contract in three months – their clients would likely have felt some kind of unease. Some might have called the fifth fact “changing the subject.” Others might have asked, “What does that have to do with the point they are trying to make?”. No matter how an audience member expresses dissatisfaction, he or she will nearly always detect an implicit switch in category. Why the “Consistent Conclusion” Test? Conclusions that don’t fit the evidence presented create a similar problem. A careless thinker might have assembled the four facts in the “entry costs” argument and concluded that Sienna simply cannot compete in the super-ceramic industry. This is a fairly common error: the writer is generalizing beyond the evidence, assuming an obvious relationship between entry costs and the ability to compete. But a critical audience will not be convinced. The evidence presented leads only to a conclusion that Sienna’s entry costs are prohibitively high. There are other considerations and other facts needed to decide the company’s ability to compete. When Do You Use Inductive Arguments? When you have enough evidence to build inductive arguments, do so. Evidence-driven inductive arguments are the most widely used form of reasoning in business presentations and writing. How Do You Sequence an Inductive Argument? In the Sienna example above, the conclusion follows the evidence. However, in the United States it is standard practice to present the conclusion before presenting the facts. The conclusion most often appears in a presentation’s introduction or at the start of a report. This positioning does not change the logical relationship between the conclusion and the evidence; the evidence still earns the conclusion. Presenting the conclusion before presenting the evidence conforms to a basic principle of communication: signaling the key message and forecasting the direction of the discussion at the beginning. What is Deductive Argument? While inductive argument begins with a series of meaningful facts and concludes with a useful generalization, deduction begins with a generalization and works to a specific, relevant fact. For example: A drop in mortgage rates always means an increase in housing sales. Mortgage rates have fallen almost two points in the last quarter in Arizona so we can expect the state’s housing market to improve soon. Deduction involves a 3-step reasoning process. It begins with an “all-or-nothing” statement that claims a relationship between two characteristics, in this case mortgage rates and housing sales. A second statement cites a specific example of the first characteristic, here declining mortgage rates in Arizona. The conclusion argues that any example of the first characteristic will also be an example of the second. Diagrammed, the deductive argument above looks like this: Major Premise: Minor Premise: Deduction: All declines in mortgage rates result in increases in housing sales. Arizona banks dropped mortgage rates almost two points last quarter. Arizona will soon see increases in housing sales. The diagram shows the power and the limits of deduction. The power of this form of reasoning rests in the fact that if a writer or speaker is able to present a major premise that an audience will accept as true, and follow it with a minor premise that the audience also accepts as true, then the audience is compelled to accept the conclusion as true. But as neat as this 3-step path to truth is, it is rarely an effective tool in business communication. The skilled reader or careful listener is usually able to deny the truth of the major premise, and once that is discredited the entire argument self-destructs. What are the Tests of an Effective Deductive Argument? What makes a deductive argument effective? Again, rational thinkers naturally ask two questions when faced with an “all-or-nothing” premise. 1. Clarity – Is the major premise sufficiently clear in scope and precise in language so that I understand it fully? 2. Veracity – Can I fully judge that the major premise is true, without exception? What Determines Clarity? The major premise in the housing sales example above fails the first test. The scope of the statement is not clear. Is the premise claiming a national relationship between mortgage rates and housing sales or addressing more limited markets? The words “decline” and “increase” will also trouble a thoughtful audience. If Arizona mortgage rates were steady for five years, rose 1 percent in the sixth year, and then dropped 0.25 percent in the seventh year, does this count as a “decline”? And if housing sales dropped for five years annually after that decline and then improved in the sixth year, does that represent an “increase”? What Determines Veracity? The chance that any given audience member’s knowledge of a subject will be so exhaustive as to be able to determine with 100 percent certainty that all of a deductive argument’s premises are true is close to nil. Full knowledge is not necessary however. If a single exception to a premise claim comes to mind, the proposition has been proven false and the conclusion has also been negated. While the information above focuses on the audience’s response to deduction, writers and speakers can critique their deductive arguments with these two tests. As with inductive reasoning, communicators who ensure that their arguments pass these tests will be more convincing. In most cases a careful review will lead to the realization that it is extremely difficult to shape an “all-or-nothing” statement that will hold true in the world of business. Is Deduction Ever an Effective Strategy in Business Reasoning? There is a way to make the deductive method pay some dividends. Even though the rules of formal logic insist on “all-or-nothing” statements as major premises, in the real world, readers and listeners will settle for qualified premises. For example: Eighty percent of the “$10-off” online offers for dinner at a national chain restaurant have increased sales by 5 percent or more during the redemption period. We are about to issue another “$10-off” dinner offer and project an 80 percent chance that sales will again increase by 5 percent or more during the redemption period. This argument drops the language of certainty in favor of the language of probability. Projections are understood to be provisional statements, based on recognition of uncertainty. Audiences have learned to accept this amended form of logic, but still expect it to be shaped as deduction. More important, the success of the argument will be determined by the precision of the statement of probability. The “80 percent” is likely to be perceived as a figure that allows a useful conclusion. If the writer or speaker had claimed that “some “or “many” of the previous online coupon offers had resulted in sales increases of 5 percent or more, the conclusion would not have been perceived as useful. In this regard the evidence test of specificity comes back into play. One final note: the deductive form is frequently phrased as an incomplete argument, looking something like this: Tellgon can’t make payments on its present bank loans, so it wouldn’t be able to make payments on new bank loans. This form is acceptable as logic (most common in less formal communication, such as conversation or email) but does place an additional burden on the reader or listener. It presents just a minor premise and a conclusion. The audience must mentally construct the major premise that the argument assumes, in this case that all companies unable to meet existing bank loans prove unable to make payments on any new bank loans. If the above argument looked acceptable at first glance, it should look more than suspect when you see the major premise. If a single instance can be recalled when an entity behind on payments to one lender was able to get a loan from another, the claim will be rejected. The key for writers and speakers is to be certain to mentally shape and examine the assumed major premises that are implicit in arguments with only the minor premise and conclusion. How Does Argument Affect Structure? Most business arguments are multifaceted, containing multiple lines of inductive reasoning. For example, a presentation of the results of an environmental impact study preceding development of a deep sea port would be structured as a series of arguments under relevant categories such as biological, chemical, and infrastructure impacts. The presentation’s conclusion collects the findings under each category of assessment. The evidence for conclusions in each category will be detailed, and the reasoning linking each category’s conclusion to any overall recommendations explained. In other words, a consistent pattern of assertions and support mark each aspect of the presentation. The written report of such an assessment would follow the same structure overall and at the unit level. The structure of each paragraph, in other words, is also determined by the evidence for one inductive argument. The first sentence makes the claim; all subsequent sentences provide support for it. Deduction alone is seldom used to create structure. But writers and speakers may combine inductive and deductive arguments to reach a conclusion. The key to effectiveness is to methodically develop one or the other as the organizing tool of all argument. A Final Consideration: Acknowledge and Overcome1 Frequently you will draft arguments that support your position knowing that your audience is aware of significant contradictory evidence or counter arguments. Your audience may also be considering a competing proposal. Knowing this gives you a choice: you can either concentrate solely on your position or attempt to acknowledge and overcome the opposition. Unless there is 1 The concepts cited under A Final Consideration: Acknowledge and Overcome were first presented by Professor JoAnne Yates of the MIT Sloan School of Management in a teaching note titled “Persuasion: What the Research Tells Us.” something about the task or organizational culture that suggests otherwise, the “acknowledge and overcome” strategy should work best. This strategy has several merits. 1. 2. 3. 4. It suggests a fair and thorough, 2-sided consideration of the issues. It tends to enhance credibility (and may diminish the credibility of the opposition). It can nip opposition in the bud. Research suggests it is the best way to influence skeptical audiences, even those who oppose your idea before you speak or write. Research also suggests a best structure: 1. Present your position and arguments first. 2. Follow with the negative evidence or evaluation of the competing proposal. 3. Conclude with arguments that demonstrate the superiority of your position. The rules of logic examined here focus on reasoning in a business argument. Audience-ready presentations and writing involve much more. Other rules, governing structure in introductions, conclusions, and the central body of a message, help communicators systematically construct persuasive arguments for different audiences in multiple forms. Evidence means more than hard data; stories, analogy, quotes, and metaphor can provide compelling support for a range of claims. Language choice can make the difference between an argument that is compelling and one that is dull. Persuasion is complex; skill in logic of argument is one key. 
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