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Problem Solving in Business: PROBLEM SOLVING STEPS

This guide is designed to help you approach your business problem solving process in a systematic way through information sources that can help you understand your situation more clearly and provide a distinct direction towards the appropriate solution.

Problem solvers are constantly trying to proactively shape their environment.

*  Review and document how processes currently work

*  Why do you think there's a problem (identify potential causes: who, what, why, where, how)

*  State the problem as clearly as possible

  • A problem statement is a concise description of the problem or issues a project seeks to address. The problem statement identifies the current state, the desired future state and any gaps between the two. A problem statement is an important communication tool that can help ensure everyone working on a project knows what the problem they need to address is and why the project is important.

SOURCE: Image result for indeed career guide logo

Business Problem Statement Example

Problem Statement: Intensive manual processing due to physical handling of paperwork.

Description: Annual leave forms are typically filled out by the Employee, printed, sent to the Manager/Delegate for approval, sent to Human Resources for verification and data entry, scanned and uploaded to the EDRMS, and then sent to Payroll for (re) data entry.

Risk: This highly manual scenario leads to ‘bottlenecks’ in service delivery and promotes the risk of poor organisational response to business and lost time that should be spent carrying out core business.

SOURCEThe Business Analyst's Toolkit

 

Get input from people who are affected by the problem

*  Write down opinions and observations of people affected by the problem

*  Consider all potential causes of the problem: competition, business model, market factors, team performance, etc.

*  If needed, conduct a SWOT analysis (Strengths, Weaknesses, Opportunities, Threats)

*  Employ research tools, such as information sources, databases, surveys, and interviews for fact finding, data gathering and analysis, etc.

Example of a SWOT ANALYSIS 

Strengths

*  Robust inorganic growth strategy established cisco as a technology leader

*  Steady revenue growth

*  Business performance of infrastructure platforms

Weaknesses *  Supply Chain Issues Leading to Delays in Order Fulfillments
Opportunities

*  Poised to benefit from the robust growth in cloud computing market

*  Strategic initiatives

*  Positive outlook for global IT hardware market

Threats

*  Product overlapping

*  Volatility in the sales to the service provider market

*  Intense competitive pressure

SOURCE: Cisco Systems, Inc. SWOT Analysis; Date: October 26, 2020

SOME FRAMEWORKS TO HELP YOU ANALYZE THE PROBLEM

Porter's Five Forces

  1. Threat of New Entrants (effectively, this is “Barriers to Entry”)
  2. Competitive Dynamics
  3. Supplier Power
  4. Buyer Power
  5. Threat of Substitutes

The 3 Cs

  1. Company
  2. Competitors
  3. Customers/clients

The 4 Ps

  1. Product
  2. Price
  3. Placement
  4. Promotion

SWOT

  1. Strengths
  2. Weaknesses
  3. Opportunities
  4. Threats

 

SOURCE and for additional information on analysis frameworks and more, please go to: STREETOFWALLS

Postpone the selection of one solution until several problem-solving alternatives have been proposed. Considering multiple alternatives can significantly enhance the value of your ideal solution. Once you have decided on the "what should be" model, this target standard becomes the basis for developing a road map for investigating alternatives. Brainstorming and team problem-solving techniques are both useful tools in this stage of problem solving.

Many alternative solutions to the problem should be generated before final evaluation. A common mistake in problem solving is that alternatives are evaluated as they are proposed, so the first acceptable solution is chosen, even if it’s not the best fit. If we focus on trying to get the results we want, we miss the potential for learning something new that will allow for real improvement in the problem-solving process.

SOURCE: Image result for asq logo

Characteristics of Good Alternatives

Value-Focused --  meaning that they are explicitly designed to address the fundamental values or ends of the decision – the “things that matter” or “felt needs”, as defined by the objectives and the evaluation criteria;

Technically Sound --  meaning that in developing alternatives for achieving the objectives, the project team has drawn on the best available information about cause and effect relationships and has designed creative and diverse alternatives based on sound analysis;

Clearly and Consistently Defined -- meaning that all alternatives are defined to a sufficient and consistent level of detail using logically consistent assumptions, and that a base case against which all alternatives can be compared has been clearly established;

Small in number and high in quality --  meaning that poor (dominated) alternatives have been eliminated and those remaining have been iteratively refined to incorporate new ideas and joint gains;

Comprehensive and mutually exclusive --  meaning that individual elements or components of a strategy are combined into complete packages, and that the packages are directly comparable;

Able to expose fundamental trade-offs --  meaning that they emphasize rather than hide difficult but unavoidable value-based trade-offs and present real choices for decision makers;

Developed collaboratively with the people most affected --   because difficult trade-offs are easier to make and to accept when people believe that a thorough search for good alternatives has been conducted and that the best alternatives are on the table.

SOURCEImage result for "structured decision making" or sdmlogo

THE KEY QUESTIONS TO ASK BEFORE DECIDING ON A SOLUTION TO IMPLEMENT

  • Does the solution meet Customers’ Requirements?
  • Is it aligned to the  Business Strategy / Mission and Values /
  • What Impact will this have on the business now ?
  • What Potential Impact  will the solution have in the future ?
  • What Business Benefit does the solution bring?   – This is one where you need to strike a balance between tangible and non-tangible ideas in order to get everybody on board. The difference between these categories are that tangible ideas will lead to a financial improvement whilst non-tangible suggestions contain a non-monetary aspect. But this doesn’t mean they are not important, as often this intrinsically contributes a lot to the well-feeling and being of employees.
  • Does the solution directly impact one of the KPI’s ?
  • How much Time will it take to implement solution ?
  • What is the Urgency in implementing this solution ?
  • What Investment and resources are required? / How much will the solution Cost ?
  • What is the Payback (in years) for this investment ?
  • What is the Value of the solution ?
  • What Authority will be needed to approve the solution ?
  • How Complex is the solution ?

It goes without saying that some of these questions may not be applicable to every type of solution you’re considering and should be therefore be used as a generic guide.

SOURCE:All About Strategic Planning from The Free Management Library |  Organizational management, Business management, Strategic planning 

 

 

How will you know your problem is solved? And not just the symptom -- how will you know when you've addressed the underlying issues? Before you dive into enacting the solution, make sure you know what success looks like.

Decide on a few key performance indicators. Take a baseline measurement, and set a goal and a timeframe. You're essentially translating your solution into a plan, complete with milestones and goals. Without these, you've simply made a blind decision, with no way to track success. You need those goals and milestones to make your plan real.

The key to effective problem-solving in business is the ability to adapt. You can waste a lot of resources on staying the wrong course for too long. So make a plan to reduce your risk now. Think about what you'd do if you were faced with a problem large enough to sink your business. Be as proactive as you be.

 

SOURCE: Image result for LIVEPLAN LOGO

10 CRITERIA TO CONSIDER WHEN DESIGNING 
KEY PERFORMANCE MEASURES

Consider this list of criteria when building out your key business performance measurement systems:

  1. Be based on quantities that can be influenced, or controlled, by the user alone or in cooperation with others
  2. Be objective and not based on opinion
  3. Be derived from strategy and focus on improvement
  4. Be clearly defined and simple to understand
  5. Be relevant with an explicit purpose
  6. Be consistent (in that they maintain their significance as time goes by)
  7. Be specific and relate to specific goals/targets
  8. Be precise – be exact about what is being measured
  9. Provide timely and accurate feedback
  10. Reflect the “business process” – i.e. both the supplier and customer should be involved in the definition of the measure

SOURCE:Image result for KLIPFOLIO LOGO 

 

 "WImage result for steve jobshen you first start off trying to solve a problem, the first solutions you come up with are very complex, and most people stop there. But if you keep going, and live with the problem and peel more layers of the onion off, you can often times arrive at some very elegant and simple solutions."  -- Steve Jobs

CRITERIA FOR EVALUATING A CREATIVE SOLUTION

SUCCESSFUL

  • Solves the problem effectively --  The solution achieves the stated goals, meets a need well.
  • Has acceptable trade-offs -- Negative side effects (collateral damage in a military operation, side effects of a medication, hostile customer reaction, high electrical consumption) must also be factored in.
  • Meets constraints -- The solution works within the stated constraints to the problem (or overcomes or circumvents them in some acceptable way).
  • Acceptable to users -- The solution is agreeable to those who must implement it, to society, to those affected by it. It is not "technologically brilliant but sociologically stupid."

EFFICIENT 

  • Good cost/benefit ratio -- The solution is economical, with high price/performance ratio.
  • Practical -- The solution is logical, useful, systematic, understandable, "do-able," not overly difficult or complex for the intended benefits. It is as simple and direct as possible for the desired outcome.
  • Reliable --The solution will continue to work over time with a high degree of reliability, consistency, and effectiveness.

NEW

  • Original -- The solution is innovative, breaking new ground.
  • Surprising -- The solution is unusual, out of the ordinary lines of thought. It might appear obvious in hindsight, but the really creative solution is nearly always surprising at first encounter.
  • Seminal -- The solution provides the foundation for further, similar solutions, opens new vistas for further development. It represents a beginning--a new line of inquiry--with the promise of a future

COHERENT

  • Unified -- The solution is organized, seamless, synthetic, organic, holistic, competent.
  • Refined -- The solution is synergetic, high quality, good, well-designed, well-crafted, well-executed.
  • Esthetic -- The solution is artistic, attractive, beautiful, enduring, timeless, likable.

 

SOURCEHomepage - VirtualSalt

 

 

HELPFUL RESOURCES

DATABASES_________________

TO FIND SAMPLE SWOT ANALYSES, AND 

COMPETITIVE INFORMATION ON

COMPANIES AND PRODUCTS

Accessible at all NYPL locations and outside the Library with your NYPL card Business Insights: Essentials -- Provides in depth coverage of businesses, including company profiles, industry profiles, products and brands, financial reports, company rankings, histories and full text periodical articles.

 

Restricted: This database is accessible at certain NYPL locations only. Please see description for details. Plunkett Research Online -- Contains industry and market research trends and statistics on many major industries, as well as  company contacts, organizations, and more. 

Restricted: This database is accessible at certain NYPL locations only. Please see description for details.EBSCOHost -- Provides access to over 30 databases with citations, abstracts and selected full-text.

Restricted: This database is accessible at certain NYPL locations only. Please see description for details.S&P Capital IQ (Standard and Poor's Capital IQ)  -- Provides in-depth financial information on companies, industry reports, equities, and more. Includes publications: S&P Analysts Handbook, S&P Bond Guide, S&P Corporation Records, S&P Stock Reports, Stovall Sectors. 

 

TO FIND INFORMATION ON MARKETS AND INDUSTRIES

Restricted: This database is accessible at certain NYPL locations only. Please see description for details.IBISWorld -- IBISWorld is the largest collection of industry and market research including specialized industries for small business research.

Restricted: This database is accessible at certain NYPL locations only. Please see description for details.First Research  -- Industry profiles include industry overview, recent developments, business challenges, trends and opportunities, executive insight,call preparation questions, financial and industry ratio's, industry forecast, web links and acronyms. 

Restricted: This database is accessible at certain NYPL locations only. Please see description for details.e-Marketer -- Market research reports, data, charts, about anything "e":e-commerce, internet, social media, digital, technology use and adoption,online advertising, mobile, marketing, demographics and more. eMarketer aggregates and analyzes research from 1,700+ sources and produces analyst reports, statistics, and and charting features.

TO FIND DEMOGRAPHIC INFORMATION

Restricted: This database is accessible at certain NYPL locations only. Please see description for details.Mergent Intellect -- Mergent Intellect is an expansive directory database that includes more than 100 million private US, Canadian and global businesses, more than 6000 US public companies and over 200 million residents and local businesses, with previous addresses and allowing for reverse telephone lookups. 

Restricted: This database is accessible at certain NYPL locations only. Please see description for details.SimplyAnalytics -- SimplyAnalytics includes thousands of demographic, business, and marketing data variables. **Patrons should read the Terms & Conditions and Privacy Policy of this resource before searching.**

TO FIND ARTICLES ON HUMAN RESOURCES, MANAGEMENT, MARKETING, AND MORE 

Restricted: This database is accessible at certain NYPL locations only. Please see description for details.EBSCOHost -- Provides access to over 30 databases with citations, abstracts and selected full-text. Includes Academic Search Premier, Business Source Complete and other subject-specific resources. 

Accessible at all NYPL locations and outside the Library with your NYPL card Business Source Complete -- The Business Source Complete database includes full text business journals and magazines, covering all disciplines of business, including marketing, management, accounting, banking, finance and more. 

TO FIND GLOBAL INFORMATION

ERestricted: This database is accessible at certain NYPL locations only. Please see description for details.merging Markets - Internet Securities -- Full-text articles, news, company, industry and market information for emerging market countries around the world.

 

TRAINING VIDEO___________

Accessible at all NYPL locations and outside the Library with your NYPL card lynda.com -- Lynda.com, a LinkedIn Company is an online educational site that includes over 5,700 courses (and over 180,000 videos) in popular fields like web design, web development, IT, education/instruction, media production, and business. Experts create and deliver all courses as well as provide supplemental materials like exercise files and relevant work samples. Users will need to create accounts in order to track course progress, create playlists of potential coursework, and keep course notes.

 

SURVEY TOOLS____________

FOR REVIEWS ON FEE-BASED AND FREE SURVEYS

Site Logo

 

BOOKS _________________

Hardback cover of Entrepreneurs Who Changed HistoryEntrepreneurs who changed history 

ISBN: 9780744036138

Whether titans of industry, influential business leaders, or creators of history's most recognizable brands, these entrepreneurs had the vision, innovation, and ruthless determination to make their marks on our society in indelible ways. 

Cover ArtThe Decision Book by Mikael Krogerus; Roman Tschappeler 

ISBN: 9780393652376

Publication Date: 2018-05-08

This updated edition of the international bestseller distills into a single volume the fifty best decision-making models used in MBA courses, and elsewhere, that will help you tackle these important questions. In minutes you can become conversant with: The Long Tail * The Maslow Pyramids * SWOT Analysis * The Rubber Band Model * The Prisoner's Dilemma * Cognitive Dissonance * The Eisenhower Matrix * Conflict Resolution * Flow * The Personal Potential Trap * and many more. Stylish and compact, this little book is a powerful asset. 

Customer data and privacy [electronic resource] : The insights you need from harvard business review. by Harvard Business Review 

ISBN: 9781633699878

Collect data and build trust. With the rise of data science and machine learning, companies are awash in customer data and powerful new ways to gain insight from that data. Customer Data and Privacy: The Insights You Need from Harvard Business Review brings you today's most essential thinking on customer data and privacy to help you understand the tangled interdependencies and complexities of this evolving issue. The lessons in this book will help you develop strategies that allow your company to be a good steward, collecting, using, and storing customer data responsibly.

 

WEBSITES_________________

 

McKinsey & Company | UVA Career CenterSIX PROBLEM-SOLVING MINDSETS FOR VERY UNCERTAIN TIMES

 

 

ForbesTHE 4 MOST EFFECTIVE WAYS LEADERS SOLVE PROBLEMS

 

 

 

 

New Afterburner - Afterburner | Full Size PNG Download | SeekPNGFOUR ROOT CAUSES OF BUSINESS PROBLEMS

 

 

Free Management Library | East West University Library

PROBLEM SOLVING AND DECISION MAKING (SOLVING PROBLEMS AND MAKING DECISIONS)

 

 

 

Harvard Business Review Home

ARE YOU SOLVING THE RIGHT PROBLEMS?

 

 

 

Insider logosNINE STEPS TO EFFECTIVE BUSINESS PROBLEM SOLVING