Problems are always part of the businesses. The task of an entrepreneur is to detect and solve them. But besides discovering and removing the problems entrepreneurs have to pay attention to their preventive removal, so they would never occur again to harm the business.
What I can see when it comes to the problem-solving process that entrepreneurs employ is following:
- They partially solve the problem.
- They solve the problem without removing the reasons for its occurrence.
- They recognize reasons that are not essential for the occurrence of the problem.
- There is a lack an entrepreneur to see the problem-solving process as a business improvement process.
How you can avoid such undesirable things in the business?
The answer is simple, through proper analysis of the situation, identifying root causes for the occurrence and removing of them which will provide such a situation never again to be part of a process.
Among the various tools for such an analysis is a cause and effect diagram, also known as a fish bone diagram or Ishikawa diagram.
What is Cause and Effect Diagram?
Cause and Effect diagram was developed by Professor Kaoru Ishikawa, a pioneer in the field of quality management from the 60s in the last century.
The diagram is called as a fish bone diagram because the final look of it will be in the form of fish bone.
Although the basis of development of the diagram was to improve the quality, this technique can also be helpful in analyzing various business processes such as detection of causes, detection of “bottlenecks” in the manufacturing process, improvement of various processes …
The technique is good because of unique method that enables creative thinking and breakdown things into the reasons in order to come to the right solution.
How You Can Use the Tool?
To use this tool you need to have a problem that needs a solution. Is there a business without the problems?
I will try to cover the basic steps in the implementation of the technique in the problem-solving process.
Step 1: Identify the Problem.
First thing that you need to do is to identify the problem you want to analyze. Good starting point is to start with a description of the situation, consequences for your business, possible reasons, responsible departments, etc.
Once you define the problem, you can start to construct the diagram as shown in the image below.
Step 2: Identify the Main Causes of the Problem.
In this case, the problem is the effect from some causes, and therefore, the second step must identify all possible reasons for this situation.
When it comes to business problems, it is best to start with subjects or business elements that can be the cause of this problem. These elements can be people, procedures, materials, skills, systems, equipment …
The task of this step is to brainstorm as many as possible potential reasons for the problem.
Once you identify all main reasons you can add them on the diagram as shown in the image below.
Step 3: Identify all Possible Sub-causes in Each Main Cause.
Since you already have the main reasons then each of these causes is the result of more sub-causes. If you ask why for each main cause, you will have many answers that can simply become sub-causes. For example, if one of the main reasons for a late delivery is the production process, we can have possible sub-causes as following:
- Long preparation time,
- Not optimized layout in plant,
- Wrong norms,
- Too many errors in production process,
- Wrong planning …
For each of these reasons there will be probably additional reasons that you will need to break down into the diagram. For example, if you take errors in production process, possible reasons can be:
- Employee training,
- Raw materials with low quality,
- Mistakes in maintenance of technological equipment …
After you identify all possible sub-causes for each main cause into the tiniest detail of breakdown you can add them in the diagram as in the image below.
Step 4: Analyze Diagram.
Once you finish the previous step, you will already have a complete diagram that shows all possible causes of the problem. This way will allow you to identify more than one reason. In business only one cause for a problem is not the usual case. The problems are complex and require more complex solutions.
Therefore, in this step, you will need to analyze the diagram. The analysis will require detailed consideration of each cause by recording the state of the field, conversations with responsible people, interviewing, meetings …
The purpose of the analysis is to prepare a project with specific steps to solve the problem and eliminate all possible causes in the way they will not occur in the future.