Problem Solving for Optimal Organization
For this next series, I will be discussing what I call the “Optimal Organization.” I will spend the next few articles talking about areas that I see as important for getting the most out of your organization. Over the coming weeks, I will dive into: Getting to Root Cause, Culture, Toxic Employees and more.Okay, let’s get started. Before we get into other topics, let’s discuss problem-solving, i.e. getting to root cause issues. In the EOS ® world this is called IDS or Identify, Discuss and Solve. It is based on the Six Sigma principles of getting to root cause.Here is an example and a template you can follow:1. Clarify The Problem Problem StatementWhat is the Current State? We are losing deals to our competitor at a rate of 3 - 1.Performance Gap: If we continue at this rate we will go out of business within one year.(Business Problem)What is the Ideal State: We know we will not win every deal but we need to win at least 50% of deals.2. Why is it this way? Ask 5 why’s minimal to get to root cause:Redefined Problem: What is causing the increase of losing deals?Answer One: “I have heard we are priced too high.”Why? “Why are we priced too high?”Answer Two: “Our margins are already very tight.”Why? “Why are our margins so tight?”Answer Three: “We have a higher cost in developing our product.”Why? “Why do we have a higher cost?”Answer Four: “One of our key suppliers has increased their prices by 25%.”Why? “Why did they increase their price to us so much?”Answer Five: “I heard it is tied to a new regulation in Ohio.”Why? “Why in Ohio?”3. Identify Primary Root CauseAfter discussions with your team, you should begin to peel the onion back and get to the root cause of losing business that is tied to the new regulation in Ohio, which is increasing a suppliers’ costs and rendering you less competitive.4. Develop SolutionsNow begin to develop multiple solutions. For example: one solution might be, “Can we find states without this regulation and suppliers like our competitor to drive costs back down?” List out the specific costs to implement this new solution and the time it will take to implement the new solution.5. Identify Target Behaviors, Set Metric TargetFor example, research state regulations. Give your team a deadline. Set a target for speaking with three different suppliers per week over the next two months and pick a winner.6. Implement And Monitor ResultsMake an action plan. I personally like to use a GANT chart that lists milestones, ownership, etc. Measure and monitor immediately upon deployment.If you and your team follow these simple steps and stick to them, there is no problem you can’t solve no matter how complicated the business problem. Throughout the process it is very important NOT to jump to conclusions and assume ROOT cause and or start listing out solutions before you complete the 5 Why’s.Take action today.Try this in your next team meeting and see the results in action. This will help solve a lot of problems and prevent you from wasting a lot of time and money guessing. This simple tactic can help drive a more effective and “Optimal Organization.”If you have any questions and/or would like a copy of an excellent template we use with our,clients, send us an email: firstname.lastname@example.org. In the next article, I will discuss culture and its critical role in your business development.