Problem Solving for Executives Part 1

Welcome to Problem Solving Skills Part 1

The tools in this section help you solve complicated business problems.
By using these techniques, you can start to tackle problems that might otherwise seem huge, overwhelming, and excessively complex.

As such, these tools give you a starting point in solving problems that would leave other people feeling helpless, and intimidated by the situation.

The section starts with some simple complexity skills. It then moves on to look at more powerful, 'industrial strength" techniques like use of Systems Diagrams, SWOT Analysis, Cash Flow Forecasting and Risk Analysis. We conclude with four powerful business strategy tools: Porter's Five Forces, PEST Analysis, Value Chain Analysis and USP Analysis.

Enjoy using these tools!

Before we go the the more complicating techniques, I would like to introduce you to 2 very simple techniques:

1) Appreciation: Extracting Maximum Information from Facts

2) 5 Whys - Getting quickly to the root of a problem
Appreciation

Extracting Maximum Information from Facts


Appreciation is a very simple but powerful technique for extracting the maximum amount of information from a simple fact.


How to Use the Tool:

Starting with a fact, ask the question 'So what?' i.e. what are the implications of that fact? Keep on asking that question until you have drawn all possible inferences.


Example:

Appreciation is a technique used by military planners, so we will take a military example:

Fact: It rained heavily last night
So What?
- The ground will be wet
So What?
- It will turn into mud quickly
So What?
- If many troops and vehicles pass over the same ground, movement will be progressively slower and more difficult as the ground gets muddier and more difficult.
So What?
- Where possible, stick to paved roads. Otherwise expect movement to be much slower than normal.


While it would be possible to reach this conclusion without the use of a formal technique, Appreciation provides a framework within which you can extract information quickly, effectively and reliably.

Key points: Asking 'so what?' repeatedly helps you to extract all important information implied by a fact.


5 Whys

Quickly Getting to the Root of a Problem

Why use the tool?

The 5 Whys is a simple problem-solving technique that helps users to get to the root of the problem quickly. Made popular in the 1970s by the Toyota Production System, the 5 Whys strategy involves looking at any problem and asking: "Why?" and "What caused this problem?"


Very often, the answer to the first "why" will prompt another "why" and the answer to the second "why" will prompt another and so on; hence the name the 5 Whys strategy.

Benefits of the 5 Whys include:


It helps to quickly determine the root cause of a problem It is easy to learn and apply How to use the tool:

When looking to solve a problem, start at the end result and work backward (toward the root cause), continually asking: "Why?" This will need to be repeated over and over until the root cause of the problem becomes apparent.

Tip:

The 5 Whys technique is a simple technique that can help you quickly get to the root of a problem. But that is all it is, and the more complex things get, the more likely it is to lead you down a false trail. if it doesn't quickly give you an answer that's obviously right, then you may need more sophisticated technique problem solving techniques like those found in our problem solving section.


Example:

Following is an example of the 5 Whys analysis as an effective problem-solving technique:

Why is our client, Hinson Corp., unhappy? Because we did not deliver our services when we said we would.

Why were we unable to meet the agreed-upon timeline or schedule for delivery? The job took much longer than we thought it would.

Why did it take so much longer? Because we underestimated the complexity of the job.

Why did we underestimate the complexity of the job? Because we made a quick estimate of the time needed to complete it, and did not list the individual stages needed to complete the project.

Why didn't we do this? Because we were running behind on other projects. We clearly need to review our time estimation and specification procedures. Key Points:

The 5 Whys strategy is an easy and often-effective tool for uncovering the root of a problem. Because it is so elementary in nature, it can be adapted quickly and applied to most any problem. Bear in mind, however, that if it doesn't prompt an intuitive answer, other problem-solving techniques may need to be applied.