Analysis of Business problems has, simultaneously, been a fun and very challenging experience. The course aims to instil in us the ability to make sound, informed decisions. Once learned, this skill of systematically analysing problems can be applied in multiple business scenarios and even, life issues. Our learning experience in class is further enhanced through the use of multiple cases; qualitative and quantitative.
The first step in the analysis of a problem is asking the right questions. The quality of questions asked will determine the usefulness of the answer we obtain, with respect to solving the issue. A framework for asking questions is the “Five W’s and one H”.
- What? – What’s the issue the facing the protagonist?
- Why? – Why is this considered an issue?
- Who? -Who’s the protagonist or organisation in question? What’s their identity? What are their values?
- When? – This deals with time. How long has this persisted for? What is the time frame given to solve the issue (if any)?
- Where? – This is focused on location. Where is this issue taking place? That could translate to what’s the location of the protagonist’s organisation or target market? Does the scope of the issue cover multiple locations or countries?
- How? – How did this issue arise?
This framework helps us identify the core of problem and craft a statement, that puts the objective clearly in view. Take for instance this contrived statement based on the case “Clean Spritz”:
“MJ Brenner, a cleaning product manufacturing company, has been experiencing an average 7.5% annual decline in sales for one of its leading products, Clean Spritz, over the last five years. This decline was due to the reduced spending of customers which was in turn due to an economic recession and rise in the awareness of environmentally friendly products. Claire Beaton, the brand manager, seeks to reverse the situation as soon as possible.”
Having had a clear picture of the objective, we would begin to examine the options or paths the protagonist could take to arrive at it. In the case of Claire Beaton, three options were open to the company;
- Relaunch a version of clean spritz with more aggressive marketing.
- Develop a new product category and release to market.
- Maintain the status quo.
In deciding which of the options is more viable, the company has to look at a number of criteria. The criteria are things to consider when making the final decision. A number of things which the company had to consider in this case included the cost of advertising clean spritz at a relaunch, the cost of producing or manufacturing a new product line. All these would be examined in the light of the potential impact on the company’s revenue. Finally, the next bit following this would be the data analysis; which of these options allows us to achieve our objective while maintaining the criteria that we already mentioned before? Looking at the data we have; our revenue from the previous fiscal year and the net earnings; are we to incur additional cost of production? Looking at the current market and consumer behaviour, what are the chances of making a profit within X number of years? These are common questions that the data exhibits help to answer.
While certain facts may differ from case to case, the framework of analysing stays the same. Ask the right questions, identify the objective, determine the necessary criteria, highlight alternatives or paths to the objective, looks at the numbers and facts and then make a decision based on them.