JOSHUA VELDMAN

{"user_id":2806,"source":"https://www.bdc.ca/en/articles-tools/operations/operational-efficiency/7-steps-solve-operational-problems","source_type":"link","title":"Root Cause Analysis and Problem Solving for Entrepreneurs","description":"Follow this 7-step structured problem-solving process to identify and resolve the root causes of problems once and for all.","html":"\u003c!DOCTYPE html PUBLIC \"-//W3C//DTD HTML 4.0 Transitional//EN\" \"http://www.w3.org/TR/REC-html40/loose.dtd\"\u003e\n\u003chtml\u003e\u003cbody\u003e\n\u003ch1 id=\"cr-title\"\u003eRoot Cause Analysis and Problem Solving for Entrepreneurs\u003c/h1\u003e\n \u003cdiv id=\"cr-content\"\u003e\u003cdiv id=\"readability-page-1\" class=\"page\"\u003e\n\u003cdiv data-taxon-component=\"text\" data-taxon-text-title=\"ctn-text-main\" data-taxon-text-contentid=\"11997\" data-taxon-text-display=\"default\" data-taxon-parent=\"true\" qid=\"11997\"\u003e\n\n \n\n \n\u003ch2 id=\"1-identify-the-problem\"\u003e1. Identify the problem\u003c/h2\u003e\n\u003cp\u003eThe first step is to identify critical problems in your business. Examples could be:\u003c/p\u003e\n\u003cul\u003e\n\u003cli\u003edeclining customer satisfaction\u003c/li\u003e\n\u003cli\u003ehigh employee turnover\u003c/li\u003e\n\u003cli\u003ea drop in profitability or sales\u003c/li\u003e\n\u003cli\u003einstances of the \u003cspan\u003e“\u003ca href=\"https://www.bdc.ca/en/articles-tools/operations/operational-efficiency/8-types-of-waste-to-identify-in-business\" target=\"_blank\" style=\"color: rgb(95, 99, 104);\"\u003e8 wastes\u003c/a\u003e,”\u003c/span\u003e such as inefficient operations or activity, idle employees or machines, or misused resources\u003c/li\u003e\n\u003c/ul\u003e\n\u003cp\u003eMost entrepreneurs aren’t aware of the full extent of waste and other challenges in their company. To identify them, Ambujakshan recommends doing a physical \u003cspan\u003ewalk-through\u003c/span\u003e of your plant or office, known as a Gemba walk. (This is the first of the three steps of \u003ca href=\"https://www.bdc.ca/en/articles-tools/operations/operational-efficiency/quick-guide-thinking-lean\" target=\"_blank\" style=\"color: rgb(95, 99, 104);\"\u003eimplementing lean thinking\u003c/a\u003e in a business.)\u003c/p\u003e\n\u003ch2 id=\"2-describe-the-situation\"\u003e2. Describe the situation\u003c/h2\u003e\n\u003cp\u003eNext, describe the problem in detail. For example, it’s not enough to say your company’s problem is that customers are unhappy. A better description would be that customers aren’t happy with lead times and that client satisfaction has dropped 30% from last year.\u003c/p\u003e\n\u003cp\u003e“It’s important to clearly define the problem and the associated factors contributing to that problem. On the other hand, defining the problem shouldn’t be complicated. This step, though not to be missed, is just to make sure you are solving the right problem,” Ambujakshan says.\u003c/p\u003e\n\u003cp\u003eThe six questions below could help you to describe your operational problems.\u003c/p\u003e\n\u003ch3 id=\"6-questions-to-help-describe-your-operational-problems\"\u003e6 questions to help describe your operational problems\u003c/h3\u003e\n\n\n\n\n\u003ca data-fancybox=\"images\" href=\"https://www.bdc.ca/globalassets/digizuite/31470-problemes-operationnels-960px-questions.png\" data-utag-name=\"article-7-steps-solve-operational-problems\" data-utag-rel=\"1\" target=\"_blank\" style=\"color: rgb(95, 99, 104);\"\u003e\n\n\n\u003cpicture data-taxon-component=\"image\" data-taxon-image-title=\"ctn-image-6questions\" data-taxon-image-contentid=\"113000\" data-taxon-image-display=\"default\"\u003e\n\u003csource data-srcset=\"/globalassets/digizuite/31470-problemes-operationnels-960px-questions.png?v=4a3f60\"\u003e\n\u003cimg title=\"6 questions to help describe your operational problems\" alt=\"6 questions to help describe your operational problems\" data-src=\"/globalassets/digizuite/31470-problemes-operationnels-960px-questions.png?v=4a3f60\" src=\"https://www.bdc.ca/globalassets/digizuite/31470-problemes-operationnels-960px-questions.png?v=4a3f60\"\u003e\u003c/source\u003e\u003c/picture\u003e\n\n\u003cspan\u003eEnlarge the image\u003c/span\u003e\n\n\u003c/a\u003e\n\n\u003col\u003e\n\u003cli\u003eDoes the problem happen constantly or only occasionally?\u003c/li\u003e\n\u003cli\u003eWhen did the problem occur?\u003c/li\u003e\n\u003cli\u003eWhere did the problem occur?\u003c/li\u003e\n\u003cli\u003eWhat are the processes, products or parts in question?\u003c/li\u003e\n\u003cli\u003eWhat changed recently? Are there new participants?\u003c/li\u003e\n\u003cli\u003eWho is concerned or needs to be informed?\u003c/li\u003e\n\u003c/ol\u003e\n\u003cp\u003eFor more complex problems or those involving several departments, you may need to do \u003ca href=\"https://www.bdc.ca/en/articles-tools/blog/business-process-optimization-how-to-get-started\" target=\"_blank\" style=\"color: rgb(95, 99, 104);\"\u003eprocess mapping\u003c/a\u003e. This is a way to visualize workflow from start to finish and helps you understand which processes or areas of the business are most responsible for a problem.\u003c/p\u003e\n\u003cp\u003eFor example, if your customers aren’t happy due to longer lead times, you need to better understand which area of operations is causing the delay. A process mapping exercise can show your workflow involving your different areas—for example, design, handling raw materials, fabrication, assembly, painting, finishing and shipping. With mapping, you may find out that painting contributes the most to lead time. This means the painting area is where you can prioritize efforts on a solution.\u003c/p\u003e\n\u003cp\u003e“Complex problems need broader evaluations. In such cases, mapping not only helps in visualization of your processes, but also helps you identify problem sources across your operational areas and the most impactful solutions,” Ambujakshan says.\u003c/p\u003e\n\u003ch2 id=\"3-take-temporary-countermeasures\"\u003e3. Take temporary countermeasures\u003c/h2\u003e\n\u003cp\u003eYou may need to take quick action to temporarily resolve problems until you’re able to implement a more complete solution. For example, an unhappy customer could be offered a credit or discount while the reasons for the problem are addressed.\u003c/p\u003e\n\u003ch2 id=\"4-find-the-root-cause\"\u003e4. Find the root cause\u003c/h2\u003e\n\u003cp\u003eIt’s essential to find the underlying cause of problems in order to develop the right solutions. A simple problem can be tackled with the “five whys” approach—asking “why” at least five times to trace the problem back to its source.\u003c/p\u003e\n\u003cp\u003eFor example, if protective strips are coming off a machine, the five whys process could look like this.\u003c/p\u003e\n\u003ch3 id=\"five-whys-approach-example-protective-strips-are-coming-off-a-machine\"\u003eFive whys approach example: protective strips are coming off a machine\u003c/h3\u003e\n\n\n\n\n\u003ca data-fancybox=\"images\" href=\"https://www.bdc.ca/globalassets/digizuite/31471-operational-problem-960px-five-whys.png\" data-utag-name=\"article-7-steps-solve-operational-problems\" data-utag-rel=\"2\" target=\"_blank\" style=\"color: rgb(95, 99, 104);\"\u003e\n\n\n\u003cpicture data-taxon-component=\"image\" data-taxon-image-title=\"ctn-image-5whys\" data-taxon-image-contentid=\"113001\" data-taxon-image-display=\"default\"\u003e\n\u003csource data-srcset=\"/globalassets/digizuite/31471-operational-problem-960px-five-whys.png?v=4a3f60\"\u003e\n\u003cimg title=\"Five whys approach example: protective strips are coming off a machine\" alt=\"Five whys approach example: protective strips are coming off a machine\" data-src=\"/globalassets/digizuite/31471-operational-problem-960px-five-whys.png?v=4a3f60\" src=\"https://www.bdc.ca/globalassets/digizuite/31471-operational-problem-960px-five-whys.png?v=4a3f60\"\u003e\u003c/source\u003e\u003c/picture\u003e\n\n\u003cspan\u003eEnlarge the image\u003c/span\u003e\n\n\u003c/a\u003e\n\n\u003cp\u003eMore complex problems or those involving several departments can be analyzed with an Ishikawa diagram, named after its creator, \u003cspan\u003eKaoru Ishikawa,\u003c/span\u003e a Japanese \u003cspan\u003equality-control\u003c/span\u003e guru. Also sometimes known as a fishbone diagram, the tool is a way to visualize and analyze a problem’s potential causes in various functions of a business.\u003c/p\u003e\n\n\n\u003c/div\u003e\n\u003cdiv data-taxon-component=\"text\" data-taxon-text-title=\"ctn-tb-root-cause\" data-taxon-text-contentid=\"113076\" data-taxon-text-display=\"default\" data-taxon-parent=\"true\" qid=\"113076\"\u003e\n\n \n\n \n\u003ch3 id=\"what-is-root-cause-analysis\"\u003eWhat is root cause analysis?\u003c/h3\u003e\n\u003cp\u003eRoot cause analysis is a structured way to identify underlying reasons for a business issue. It’s a key tool of operational efficiency and lean thinking. The idea is to go beyond symptoms or superficial causes of a problem to discover the core reason it occurs.\u003c/p\u003e\n\u003cp\u003eThe five whys approach and fishbone (Ishikawa) diagrams are two common root cause analysis methods.\u003c/p\u003e\n\n\n\u003c/div\u003e\n\u003cdiv data-taxon-component=\"text\" data-taxon-text-title=\"ctn-tb-main-content-01\" data-taxon-text-contentid=\"113077\" data-taxon-text-display=\"default\" data-taxon-parent=\"true\" qid=\"113077\"\u003e\n\n \n\n \n\u003ch2 id=\"5-propose-solutions\"\u003e5. Propose solutions\u003c/h2\u003e\n\u003cp\u003eWhen the root causes of the problem are understood, involve your team in brainstorming about solutions. Be sure to consider how the solutions will affect all areas of the business. You can use \u003ca href=\"https://www.bdc.ca/en/articles-tools/operations/operational-efficiency/pareto-analysis-simple-tool-prioritize-efficiency-improvements\" target=\"_blank\" style=\"color: rgb(95, 99, 104);\"\u003ePareto analysis\u003c/a\u003e to focus on the causes that have the greatest impact on your business.\u003c/p\u003e\n\n\n\u003c/div\u003e\n\u003cdiv data-taxon-component=\"text\" data-taxon-text-title=\"ctn-tb-main-content-02\" data-taxon-text-contentid=\"113005\" data-taxon-text-display=\"default\" data-taxon-parent=\"true\" qid=\"113005\"\u003e\n\n \n\n \n\u003ch2 id=\"6-establish-and-implement-an-action-plan\"\u003e6. Establish and implement an action plan\u003c/h2\u003e\n\u003cp\u003eWith your team, develop an action plan to implement the solutions. The plan should detail specific initiatives, who is responsible for carrying out them out and a timeline. It should also include key performance indicators to gauge the impact on the business.\u003c/p\u003e\n\u003cp\u003e“The effectiveness of your solutions depends on how well you manage them with your employees. That’s why creating and proactively managing an action plan is important. An action plan creates more ownership and responsibility within your team,” Ambujakshan says.\u003c/p\u003e\n\u003cp\u003eIn the example above where painting contributed to long lead times, root cause analysis may reveal that the bottleneck at the painting stage is due to long drying time of the paint. The solution could be to speed up the paint drying process. Action plan items could include steps to speed up the drying time (e.g. buying a more powerful drying fan) and measuring the drying time as a baseline to improve.\u003c/p\u003e\n\u003ch2 id=\"7-check-results\"\u003e7. Check results\u003c/h2\u003e\n\u003cp\u003eIt’s important to follow up with your team to make sure action items have been accomplished and monitor improvements to gauge impacts on your business. Also be ready to adjust your action plan if needed and evaluate any gaps between anticipated and actual results.\u003c/p\u003e\n\u003cp\u003eIf lead time goes down and clients get your product earlier, that could solve your customer satisfaction problem. If not, you may need to review the process to look for other root causes or solutions.\u003c/p\u003e\n\u003cp\u003e“Success is \u003ca href=\"https://www.bdc.ca/en/articles-tools/blog/customers-can-accelerate-operational-efficiency-journey\" target=\"_blank\" style=\"color: rgb(95, 99, 104);\"\u003edetermined by your clients\u003c/a\u003e,” Ambujakshan says. “Your customers can \u003ca href=\"https://www.bdc.ca/en/articles-tools/blog/customers-can-accelerate-operational-efficiency-journey\" target=\"_blank\" style=\"color: rgb(95, 99, 104);\"\u003eaccelerate your operational efficiency journey\u003c/a\u003e.”\u003c/p\u003e\n\n\n\u003c/div\u003e\n\u003c/div\u003e\u003c/div\u003e\n \u003c/body\u003e\u003c/html\u003e\n","hash_id":"qxCDsbwCF7G7","author":"","reading_time":"6 min read","link_sharing":true,"archived":false,"favourited":false,"folder_id":6317,"tag_list":[]}