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Consulting toolkit root cause analysis
- 1. CONSULTING TOOLKIT
Setting up the Problem Solving
Root Cause Analysis
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- 2. It is easy to stop at superficial understanding……..you need to
push your thinking to get to root causes Root Cause
WHAT IS ROOT CAUSE ANALYSIS
PROBLEM
Superficial If you stop here the
problem will recur
causes
Root A cause that you can take action on
cause that will prevent the problem recurring
Ultimate a) There often is no “ultimate cause”
cause
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b) It may not be actionable
- 3. It is easy to stop at superficial understanding……..you need to
push your thinking to get to root causes Root Cause
ASK 5 WHYS
• e.g. A business missed budget this quarter
What solutions
• Why? will you
recommend if
• Because we lost customers to our competitor you stop here?
• Why?
• Because their product offers better value than ours
• Why?
• Because our new product is 6 months late in development
• Why?
• Because many of our top engineers left
• Why?
• Because good engineers don’t feel fulfilled in our culture
• Why?
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- 4. Use “5 Whys” to probe beyond superficial causes to identify root
causes Root Cause
5 WHYS
• 5 Whys is a question-asking technique used to explore the
cause-and-effect relationships underlying a particular problem
• The primary goal of the technique is to determine the root cause of
a defect or problem
• Developed by Toyota to address manufacturing issues in Lean
Manufacturing
• TIPS:
- There can be several causes to a problem
- Don’t stop before you reach root causes
- Use hypotheses for your best guess, to be validated later
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- 5. It is easy to stop at superficial understanding……..you need to
push your thinking to get to root causes Root Cause
ROOT CAUSE ANALYSIS
How can a future US debt
default be prevented?
What is your first question
in problem solving?
Draw out the Root Cause Analysis,
asking why at each level
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- 6. Without understanding root causes, your solutions will not stick
Root Cause
ROOT CAUSE ANALYSIS OF THE NEAR US DEBT DEFAULT IN 2011
Govt tax
US Govt revenue
High monthly
expenses greater reduced
cashflow deficit US
than revenues
AND Recession
AND Govt social
All easier funding expenses
sources used up increased
In Summer Decision to by August 2nd
2011, the US default on
came within August 2nd if Decision to prioritise
days of a the debt ceiling other payments
debt default was not raised (e.g. pensions) before Gerrymandering
debt interest and migration
Politicians
make 98% of
AND focused on
incumbent seats
“Brinksmanship” Polarised primaries
safe
by Republicans partisan AND
Congress
and Democrats politics Partisan groups
delayed
increasing increasingly
Constitutional influential in
debt ceiling
limit to the debt
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primaries