The fine art of problem-solving
At its heart, marketing is an exercise in problem-solving. Whether you are trying to solve a problem for a customer (how can we help ABC Inc. to hit their productivity targets?) or solve your own problem (how can we increase our market share?) you are simply trying to move from a current, less desirable state, to a future, more desirable state.
Problem-solving is the intellectual activity that drives progress. It sits behind every invention, every innovation and every improvement. If you are attempting to solve a problem, you follow a similar path to those who asked, “How can we eradicate polio?” or “How can we put a man on the moon?”. But let’s not get too carried away, there is a big difference between similar and equivalent.
The problem you are trying to solve is, in all likelihood, a trivial matter. At least in the grand scheme of things. Nobody, outside of your market or industry (or possibly outside of your department), will care that much, if at all. But that’s OK, the act of problem-solving isn’t interested in the scale of the problem you are trying to solve. It is more concerned with process than outcome.
Think of problem-solving as a shift from X to Y. X representing the current state and Y representing the future state. Put in these terms, problem solving becomes the process of shifting from X to Y. And if you think that sounds oversimplified, you are right. It is. But it’s as good a starting point as any.
On the journey from X to Y, there will be methods to explore, and a few definitions to clarify. The most fundamental of which is ‘what is a problem?’ so that is where we will start.
Puzzles, Problems and Messes
Russell L. Ackoff, an organisational theorist and management scientist, differentiated between puzzles problems and messes as shown in the graphic below.
Let’s dig into these a little because knowing what you are dealing with is the very first step.
A puzzle is characterized by having no ambiguity. The objective is clear, the range of options are clear and there exists one correct solution. Think of a jigsaw puzzle or a crossword puzzle. It might seem at first glance that most business or marketing challenges are not as simple as this. But that isn’t always true.
Simple supply/demand optimizations are a type of puzzle. Imagine you run a sandwich shop and prepare many sandwiches, with different fillings, each morning based on anticipated demand. You want to maximise your revenue by ensuring all customers can buy the sandwich of their choice but minimise the costs of throwing away unsold sandwiches at the end of the day. As long as you have good data on historical demand and variance you can calculate the optimal number of sandwiches, of each filling, to make.
Even setting profit maximising price can be described as a puzzle. If you know your price response curve and contribution margin, there is only one price that maximises your profit. Of course, ‘knowing’ your price response curve can be tricky. It is a good example of a problem, and also an excellent segue.
“There is more than one way to skin a cat” is a go-to proverb to highlight that there exist many ways to achieve a single objective. It is also a good description of a problem; The outcome is clear (remove the skin from a cat) but the solution could take many forms. Problem-solving is the process of finding the best way to achieve an agreed goal.
In everyday language, we use the word ‘problem’ to describe any situation involving doubt, uncertainty, or difficulty. But from now on we will use Ackoff’s stricter definition that requires the challenge to be agreed upon and understood while recognizing that there exists more than one way to solve it.
Most business and marketing challenges will fit the definition of a problem. For example, ‘how can we increase market share by 5% while maintaining margins at 12%?’. But often, before we arrive at an agreed problem, we have to start with a mess.
In Ackoff’s classification, a mess is where both the question, and therefore the solution, are not agreed upon. It is characterised by a degree of ignorance, ambiguity and disagreement. There could be a whole range of descriptions and definitions about what is going on and there is no way of knowing if a solution exists at all.
When Apollo 11 sent the message “Houston, we have a problem” (note for pedants: I know that wasn’t the actual phrase used but it was the essence of the message) they were wrong. What they actually had, at least initially, was a mess.
A common first step in problem-solving is to turn a mess into a problem, and that starts with understanding and defining the issue.
Prioritise and focus
Among the many things that Albert Einstein never said is this pearl of wisdom. “If I had one hour to solve a problem, I would spend 55 minutes defining the problem and then five minutes solving it”. This is a bit extreme, particularly if the problem was “how do I make a hard-boiled egg?” and you discover the answer is to boil an egg for seven minutes. But the sentiment isn’t complete nonsense. You need to spend sufficient time to understand a problem before you can hope to solve it.
When defining and understanding the problem it is important to get the scope of the problem right. Too broad and you will be overwhelmed with competing solutions, too narrow and you close the door on possible solutions. If you ask the question “how can we grow our business?” you will be faced with so many options that you will need to prioritise before you can start looking for potential solutions. These sorts of ultra-high-level questions can be useful when you are deciding where to focus resources, but they are generally too broad to act on.
A much more common problem is to start too narrow, too soon. Asking “how can we improve the market share of harmonic scalpels from 15% to 18%, over twelve months by focusing on general surgeons in medium-sized metro hospitals?” will limit the option under consideration. (and is an example of a challenge statement rather than a problem statement, more on that later)
A better question might be “How can we increase our market share of harmonic scalpels from 15% to 18%?” which is closer to the “How do we move from X to Y?” question we discussed earlier and keeps more options on the table. There is no strict rule on the scope of a problem statement, it will vary by company and market, but in general terms think of it as a Goldilocks’ principle, not too broad, not too narrow.
The temptation to jump to a solution will remain though, even if you are disciplined enough to keep your initial problem statement fairly broad. We have a bias for action and a preference for what we know. This is not helped by the time pressure and demand for results associated with any business initiative. The tendency to rush to judgment and look for answers is so established that we need a process to avoid it, or at least moderate it, and that is a root cause analysis.
Root cause analysis is the process of understanding the why that is driving the what. Rather than looking at a problem and thinking about solving it, it is better to consider what is causing the current state. Instead of asking how can we get to 18% market share? Ask why aren’t we at an 18% market share? Understanding the causes and effects that exist today may lead you to a less obvious and more effective solution.
Only when you have defined the problem broadly and put in some effort analysing the reasons and causes will you be in a good position to develop a challenge statement that will become the focus of your idea generation. A challenge statement will be more detailed, specific and time focused as in the example earlier.
To put these initial steps in context here is a typical problem-solving process.
- Identify the problem
- Reveal reasons behind the problem
- Identify challenge statement
- Generate ideas
- Choose best solutions
Effective problem solving requires you to spend significant time on the first two steps. This is unfortunate as these steps are the ones most often missed or given the minimum of attention. It may feel that quickly identifying a challenge statement and maximising the time spent on idea generation is time well spent but it often turns out to be a false economy. The deeper the understanding of the problem, and its causes, the more innovative and successful the solution will be. Put the effort in upfront.
Maybe that Einstein ‘quote’ deserved more credit than I gave it. I bet he wishes he had said it now.