Problem-Solving Tools For Your Business

Posted 27 Jan

Problem-Solving Tools For Your Business

All businesses experience process issues, it’s part of the daily life of a business owner. But what do you do when major problems keep recurring? If you’re constantly putting out the same fires, perhaps you’re not solving the underlying root cause of these issues.

The good news is that there are some great tools out there to help you problem-solve in a structured way.

Trinity Advisory has been helping to improve and scale small to medium businesses for over 10 years. Over this time, we've come to learn about the best tools to use in getting to the root cause of problems in business and then implementing practical solutions.

Here are our suggestions for problem-solving in your business:

1. Identify the problem

The first step is to identify critical problems in your business. Examples could be:

  • Increased costs
  • reduced sales
  • profit ‘leakage’
  • staff turnover
  • customer complaints

A few ways to identify the issue is to:

  • Look at your financial reports. Often these issues arise will from receiving your financial reports from your accountant or business advisor.
  • Ask questions. Speak to your staff members or trusted clients, they are often in the best position to provide you with invaluable information.
  • Inspect at your premises. If you have one, take a look around your office, shop or factory to see what’s actually happening. See if anything looks odd or not quite right.

A simple example could be that a new client has just complained to you because they did know how to access their reports.

2. Describe the problem

It seems obvious, but the most important step in finding a solution is to correctly identify the problem. It’s hard to start solving a problem if you can’t put your finger on exactly what’s wrong.

Here are six questions to ask that could help you to describe your operational problems:

  1. Does the problem happen constantly or only occasionally?
  2. When did the problem occur?
  3. Where did the problem occur?
  4. What are the processes, products or parts in question?
  5. What changed recently? Are there new participants?
  6. Who is concerned or needs to be informed?

Once you’ve answered these questions, you’ll be closer to understanding what part of the process has broken down.

3. Map the process

If your problem involves several individuals or departments, you may need to map the process to determine where the issue is occurring.

Process mapping is a management tool that is used to visualize the flow of work within a business process. A process map shows the steps and people involved in a business process.

You don’t need to use fancy software to create a process map, you can use a whiteboard and marker to create a map of the process.

Following our example from step 1, here is a map of the Client Onboarding process:

By visually looking at your process, you can better understand where responsibilities sit and where the process may be broken.

4. Find the root cause

Once you’ve mapped your process, you’ll have a greater understanding of when and why things happen. Next, you need to find the underlying cause of problems 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. Sakichi Toyoda, the Japanese industrialist, inventor, and founder of Toyota Industries, developed the 5 Whys technique in the 1930s. Toyota still uses this method to solve problems today.

You'll know that you've revealed the root cause of the problem when asking "why" produces no more useful responses, and you can go no further. 

Here is a very simple example of the ‘why’ method in use:


5. Brainstorm solutions

When the root cause of the problem is understood, involve your team in brainstorming solutions. Be sure to consider how the solutions will affect all areas of the business.



If you find that there are multiple root causes to the issue, then you may want to use the Pareto Analysis to determine which root cause has the biggest impact. i.e. the 80/20 rule.  That is, a small number of factors is usually responsible for a disproportionate number of issues. Use the data at hand to determine which issues are causing the greatest impact on your business.

 

You can see in this example, we’ve discovered that implementing a new process might be the best way to avoid these issues from occurring in the future, especially considering that the business is in a growth phase and the issue could more regularly reoccur as time goes on.

6. Develop an action plan

With your team, develop an action plan to implement the solutions. The plan should detail specific initiatives, who is responsible for carrying them out and by when.

In the example above, the solution requires that the management team assign a staff member to the task of double-checking that all client data has been entered correctly. You’ll need to determine who that will be, when they will start and what the new process will look like.

It should also include key performance indicators to gauge the impact on the business so that results can be measured after implementation.

7. Review results

It’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.

In our example, you may gain further insights into any other undiscovered issues that you can work to resolve to get on top of quickly.

So test, measure, adjust, repeat!


If you’re a small business owner who needs help scaling your business and growing your profits, then get in contact today!

TRINITY NEXT LEVEL ACCOUNTING

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