Business Problem Solving
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1.3DefiningproblemsUnderstandingthebusinessproblemanditscontext.pptxDefining problems: Understanding the business problem and its context
Dr. Stephen Hills
Learning objectives
To be able to define a specific problem.
To be able to reframe a problem.
To be able to sharpen a problem statement.
Problem definition
The seven-steps process
How do you define a problem in a precise way to meet the decision maker’s needs?
How do you disaggregate the issues and develop hypotheses to be explored?
How do you prioritize what to do and what not to do?
How do you develop a workplan and assign analytical tasks?
How do you decide on the fact gathering and analysis to resolve the issues, while avoiding cognitive biases?
How do you go about synthesizing the findings to highlight insights?
How do you communicate them in a compelling way?
Pitfalls and common mistakes
Weak problem statements: Vague problem statements that are not specific in terms of:
Establishing what is required to make a decision on solving the problem
The action that will follow the problem being solved
Constraints of the problem-solving
Time frame and level of accuracy required for the problem to be solved
Step 1: Define the problem
Good problem definition is essential.
Specific
Measure success
Time bounded
Meets values of the decision maker
Problem Definition
Crystal clear definition of the problem you are solving is essential. A quote from Einstein:
“If I had an hour to solve a problem, I'd spend 55 minutes thinking about the problem and five minutes thinking about solutions.”
Einstein believed the quality of the solution you generate is in direct proportion to your ability to identify the problem you hope to solve.
You need to be very clear about the boundaries of the problem
the criteria for success
the time frame
The level of accuracy required.
Problem statements
Characteristics of good problem statements
Outcomes focused: A clear statement solved, expressed in outcomes, not outputs.
Specific and measurable wherever possible.
Clearly time-bound.
Designed to explicitly address decision-maker values and boundaries, including the accuracy needed and the scale of aspirations.
Structured to allow sufficient scope for creativity and unexpected results— too narrowly scoped problems can artificially constrain solutions.
Solved at the highest level possible, meaning for the organisation as a whole, not just optimised for a part or a partial solution.
SMART - specific, measurable, action oriented, relevant, and timely.
SMART Goals - specific, measurable, achievable, relevant, and time-bound.
Constraints of a project: The iron triangle
All projects have certain constraints — normally these are cost, time and scope.
Project managers work within these three project constraints.
Any changes to one of these variables will impact the others.
For a project to be successful, these three factors need to be balanced.
Boundaries focused
The Project Manager
I need to finish on time and to budget and deliver the full scope.
Outcomes focused
The Iron Triangle
The Client
It’s all about the outcomes.
A tool for defining problems: The problem definition worksheet
Decision makers
Success criteria
Key forces acting on the decision makers
Time frame for resolution
Boundaries/constraints
Accuracy necessary
Case: Reversing the decline in Wild Pacific Salmon
Reversing the decline in Wild Pacific Salmon: The Client
Wild Atlantic Salmon had seen huge declines from mismanagement that caused large-scale ecosystem harm and community economic losses.
Wild Pacific Salmon now under pressure from human development in land use and fisheries management approaches that negatively affect salmon numbers and salmon habitats.
Importance: Wild Pacific Salmon are an apex species critical element in the northern rainforest ecosystems, a substantial biomass in their own rights, which have a massive impact of freshwater and marine ecosystems.
The client were a new foundation committed to a long-term model of philanthropy, focusing and funding a few initiatives fitting the following criteria:
Initiatives with measurable outcomes.
Initiative that are important and really matter.
Initiatives where the foundation’s unique contribution mattered.
Initiatives that over time would contribute to a portfolio effect – building off and supporting each other.
The project team could have up to 15 years to work on the problem with substantial financial resources.
Porter & Kramer’s Theory of Shared Value
Initiative that are important and really matter.
Initiatives where the foundation’s unique contribution mattered.
Reversing the decline in Wild Pacific Salmon: Problem Constraints
Quick results.
Measurable ecosystem-level outcome improvements over time.
Grassroots advocacy campaigns and large-scale direct policy efforts were undesirable and, therefore, off limit.
Problem Definition Worksheet Example
Counting fish: Evolution of the problem statement
The foundation was committed to initiatives with measurable outcomes, which it was initially felt fit with tackling the declining number of Wild Pacific Salmon.
However, there are five different species in several different regions and some species are doing well in some places, others not so well.
Overall numbers go up and down throughout the year due to ocean conditions.
It is highly challenging to measure the number of Wild Pacific Salmon and to determine the impact of an initiative to reverse the decline of Wild Pacific Salmon.
However, the functioning of the North Pacific Salmon ecosystem is more measurable – looking at their food availability and habitat.
As such, the problem statement evolved to reflect this.
Problem Statement Evolution
Reframing the problem
Define problems with sufficient scope and at the highest-level
Narrowly scoped projects make for fast problem solving, but provide limited space for creative and novel solutions, employing only conventional conceptions of a problem.
Breakthrough ideas are more challenging with old models and old framing of problems.
Target your problem solving efforts at the highest level at which you can work, rather than single business units because what makes sense for single business unit may not make sense for the company overall.
Case: Reducing HIV infections in India
The Avahan India AIDS Initiative
Growing concern about the spread of HIV in India in 2003 led to the Avahan India AIDS Initiative being funded by the Bill and Melinda Gates Foundation.
The traditional public health lens of supply and demand was initially used:
Supply: Using data from front line health workers, they determined how many condoms needed to be distributed.
Demand: Raising awareness of the need to use protection.
Research with sex workers established that there was a high correlation between violence and sexually transmitted infections – men demanding unprotected sex.
The problem was reframed to incorporate reducing sexual violence against female sex workers.
Solution: Rapid response teams of community workers, lawyers and newspaper reporters.
Empowered sex workers to insist on condom use for their clients.
An article published in the Lancet Global Health journal estimated the initiative prevented over 600,000 HIV infections.
Sharpening the problem statement
Sharpening the problem statement
Problem statements keep on getting better when facts are brought to bear to sharpen the problem definition.
Set up a dialogue with the client or other stakeholders.
For example, the problem statement for underinvestment in capacity building by nonprofits was sharpened when it was understood that such underinvestment was particularly the case:
For small organisations (< 50 employees) with little discretionary funding for capacity building.
Where the service delivery was in question and systems complex.
The problem statement was sharpened to focus on small nonprofits and their need to update their delivery models for a complex systems environment.
Conclusions
Conclusions
Defining the problem well is the starting point for great problem solving because a well-defined problem is a problem half solved.
Problem definition requires understanding the boundaries of the problem, the timeframe for solution, the accuracy required and any other forces affecting the decision.
Take an opposing view to test the robustness of the problem statement.
Bring creativity into problem definition by reframing the problem.
Sharpen your problem statement as you learn more about the problem.
Homework: Think about and research potential clients and problems
Who makes a good client?
A high profile organisation for whom there is a lot of readily available information.
An existing or former employer for whom you know a lot about their business.
An organistaion with whom you have personal connections, such as family or friends in senior positions, who are willing to share information with you.
What makes a good business problem for MN7027 and MN7P13?
“Problem solving is decision making when there is complexity and uncertainty that rules out obvious answers, and where there are consequences that make the work to get good answers worth it.”
Conn & McLean (2018)
A problem for which there is complexity and uncertainty that rules out obvious answers.
A problem for which, if solved, there are consequences that make the work to get good answers worth it.
Where can I find ideas for a client and business problem?
BBC News Business or business sections of other credible news outlets.
Workshop: Problem definition worksheet
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