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How To Solve Your Business Problems

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Published on December 4, 2014

Cissoko Mamady - Author - Strategy Consultant Follow

40 3 3
Author in Business Strategy | Management Consultant

Businessisalmostallaboutproblemsolving.Therefore,havinghyperanalyticalskills
andanintellectualhorsepowerofthebrightestmanagementconsultantsisanasset.The
goodnewsisthatbylearningsometechniqueswithdeliberateefforts,youcanbecomea
goodproblemsolverlikethebest.Inmanagementconsulting,someofthebasicskills
thatyouneedtosharpenareasfollow:

1.Listening

2.Communication

3.Logicalthinking

4.Analyticalskills

5.Dataandfactbasedapproachtodealwithproblems

6.Lateralandcriticalthinking

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Inthispostforthesakeofwordscount,Iwillfocusontheapproachandthestepsyou Back to LinkedIn.com

needtotaketoarriveatyourconclusionorrecommendationdependingonyourcontext.
However,beforeanything,graspingtheproblemstatementclearly,suchwhatisthe
problemIamtryingtosolve?Beforeworryingaboutthecostsorthetimeitwill
taketosolveyourparticularstrategicchallengeisimperative.

Framinganddevelopingahypothesistouncovertheissueorsolvetheproblem

Itisimperativetograspandclarifyyourcontext,objectives,andaudiencewhenyou
framingyourproblemthatyouaretryingtosolve.Agoodapproachistousethe
SMARTmethodthatis,yourhypothesisshouldbeSpecific,Measurable,
Achievable,Resultsfocused,andTimebound.Forexample,howcanyouincrease
yourmarketby10%within3yearswithoutlaunchingnewproducts?

Likewise,youcanusetheSCQframeworktohelpyouframeyourhypothesis.Bythat,
ImeanSituation,Complication,andQuestion.Forexample,yourprofitmarginwas
30%thepastdecades(situation).However,sincethreecompetitorsenteredyour
industry,yourprofitmarginhasdeclinedto5%(complication).Howcanyou
respondtoenhanceourprofitmarginbackto30%withintwoyearswithsamecapital
structure(Question)?

Thegoodnewsabouthypothesesisthattheycanbeprovedordisprovedwithyour
findings.

Issuetree/structuredapproachtosolvingyourbusinessproblems

Anissuetreeisastructuredwayofapproachingyourprobleminlightofyour
hypothesis.Arguablyoneofthemostimportantpartsthatyoumustgetrightgiven
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thatitallowsyoutobreakdownacomplexproblemintomanageableparts.Infact,this Back to LinkedIn.com

kindofstructuredandlogicalthinkingwaspopularizedbyBarbaraMinto,aformer
McKinseyconsultant,inherbestsellingbook"ThePyramidPrinciple."Therefore,you
canfocusonthekeydriversoftheissuegiventhatmanyproblemsaffectabusiness
fromdifferentangles.

Atthisstageofyourproblemsolving,youcanbrainstormaloneorwithyourteamto
gatherasmuchasissuesyouneedtoconsiderinyourhypothesis.Inaddition,asksome
probingquestionsbychallengingsomehiddenassumptionsthatyoumayneedto
considerinyouranalysis.Likewise,dependingontheproblem,youmayneedtobreak
downtheoutcomebygoingbackwardfromtheoutcometoinputs.

However,themostimportantpartofthisstage,afterbrainstorming,istoarrangeyour
branchesinordertobeMECE(meesee).MECEstandsforMutuallyExclusiveand
Collectivelyexhaustivethatis,thebranchesofyourissuetreeshouldformthewhole
universeofissueswithoutoverlaporgaps.

Indeed,MECEisthebedrockofmanagementconsultinganalyses.Bythat,Imeanif
thecontentsofthebranchesofyourissuetreeoverlap,youranalyseswillbeflawed,
becauseyouwontbeabletograspwhichissueiscausingyourtroubles.

Inaddition,withouttheMECEapproach,youwillnotbeabletograspswiftlyand
clearlywhatissuesaretrulyinfluencingtheproblemyouaretryingtosolve.Infact,
someusefulframeworksthatarealwaysMECEare,amongothersthevaluechainand
the3CsofKenichiOhmae.Likewise,abreakdownbyyears,quarters,monthsand
daysofthemonth,gender,B2B,B2C,etc...Canalsobeveryusefulinguidingyour
MECEapproach.

Prioritizeyourissuesamongyourissuetreebranches

Thekeyinproblemsolvingisefficiency,therefore,focus
youreffortsfirstontheissuesthatwillhavethebiggestimpactontheproblemyouare
tryingtosolve.Inotherwords,usethe80/20ruletofocusonthe20%issuesthatcan
drive80%ofthesoughtafterresults.Then,whenresearching,donotboiltheocean
thatis,anendlesssearchforirrelevantandunreliabledata.Infact,besuretoknowwhat
youaretryingtoproveordisprovebybreakingyourquestintoconcreteandprecise
hypothesisbeforeyoustartgatheringtherelevantdata.

Gatheryourdata,facts,andinterview

Atthisstageofyourproblemsolving,itisimperativetodiscernbetweenopinions,
assertions,andfacts.Afactissomethingthatcanbedemonstratedtobetruehowever,
assertionsandopinionsaredifferent.Bythat,Imeananassertionissomethingthat
isheldtrue,buthasnotbeen,orcannotbe,actuallydemonstratedtobetrue.

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Likewise,anopinionissomethingthatisbelievedtobetruebythespeaker,but Back to LinkedIn.com

whichmayormaynotbesharedbyothers.

Someofthemostcommondatagatheringmethodsare:

1.Interviews

2.Surveys

3.Regulatoryfiling

4.Annualreport

5.Crediblenewspaperarticles(WallStreetJournal,FinancialTime)

6.Researchreport(Dealogic,Hoovers,Datamonitor,etc.)

7.Yourinternaldata

Analyzeandinterpretyourfindings

Whenyouareanalyzingyourdataandfacts,makesureto
discernbetweensummaryandsynthesis.Indeed,asummaryisabriefstatementin
yourownwordsaboutyourdataandfacts.

However,synthesisgoeslittlefurtherbyprovidingkeyinsightsaboutthefactsand
datathatyouareanalyzing.Inotherwords,synthesistriestoanswerthequestionso
what?Asaresult,itisparamounttoshedlightonthekeyinsightsfromyourfindings
inlieuofasummary.

Furthermore,ifyouareanalyzingyourdata,especiallyusingcharts,Ihighly
recommendusingThinkcellandMekkoGraphics.ThesetwoExcelandPowerPoint
Addonsarethebest,andtopconsultingfirmsusethemtomakestunningchartsand
graphsthatyieldpowerfulinsight.

Theseaddonswillspiceupyouranalysesandpresentationand
yieldgreatinsightsthatExcelcantdo.Furthermore,whenyouareanalyzingyourdata,
identifytrendsandpayattentiontooutliersthatis,thedatapoint(s)goingagainst
thetrends.Thenanalyzetheseoutliersasaresult,youcangetmoreinsightsinyour

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analysesbyunderstandingwhere,whenandwhytheyexist.Therefore,youcanrefine Back to LinkedIn.com

yourhypothesiswithaninductivereasoning.

Equallyimportantarethesebasicequationsandframeworksuchas:

1.Sales=#ofproductpriceperunit.

2.Profit=(Salesvariablecost)Fixedcost.

3.Profit=contributionmarginratiosalesFixedcost.

4.Cost=variablecost+Fixedcost.

5.Thedegreeofoperatingleverage=contributionmargin/Netoperatingincome.

6.4Ps=Product,Price,Place,andPromotion.

7.3CsCompanyCustomersCompetitors.

8.KeySuccessFactors(KSF)/Corecompetencies/Generaltrends/PESTEL.

9.Conjointanalysis,perceptualmapping,clusteranalysis,Porter'sFiveForces.

10.Unitsalestobreakeven=Fixedexpenses/Unitcontributionmargin.

11.Dollarsalestobreakeven=Fixedexpenses/contributionmarginratio.

12.Dollarsalestoattaintargetprofit=targetprofit+fixedexpenses/contributionmargin
ratio.

13.Unitsalestoattaintargetprofit=Targetprofit+Fixedexpenses/Unitcontribution
margin.

14.DiscountedcashflowusingtheNetPresentValuehowever,usePalisades
DecisionToolsSuiteparticularly@Riskwithatriangulardistributionfunction,itisthe
bestforincorporatingrisksassociatedwithyourcashflow.

15.Ruleof72itisaruleofthumbmethodusedtodeterminehowmanyyearsittakes
todoubleinvestmentmoney.

16.Ruleof69itisaruleofthumbthatstateshowlongitwilltakeanamountof
moneyinvestedatrpercentperioddouble.

17.Horizontalandverticalfinancialstatementanalysis.

18.WACC(weightedaveragecostofcapital).

19.Financialratios(ROA,ROE,Acidratio,etc.)

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20.RegressionandlinearprogrammingwithSolver. Back to LinkedIn.com

Recommendations

Beupfrontandtellyouraudienceyourkeymessagefollowbythewhyofyour
keymessage.Inotherwords,bestraightforwardinprovidingyourkeymessagefirst,
andthenfollowthismessagewiththelogicofyourrecommendationswiththefacts,
analyses,andevidences.

Forexample,ifyourcompanyisconsideringanexpansioninIndiaandyoudidyour
homework.Whenyouaremakingyourrecommendation,isshouldlooklikethis:

Boss,weshouldentertheIndianmarket.

Because

Wehavethecapabilities,includingthedistributionchannels(provideyourfactsand
shredsofevidence).

Ourtargetmarketislargeandgrowingat5%peryearwithmoderatecompetition
(providethefactsandevidence).

Thereisaseriousgapbetweenthesupplyanddemandthatwecanfillwithour
recognizedbrand(providethefactsandevidence).

Whenrecommendingyoursolutionsbestpracticesentailtellingthethreebest
amongyoursolutionsthatyouthinkcanmakethebiggestdifferencetoyour
problemthatyouaresolving.Asaresult,thepracticewillforceyoutothinkthrough
yourrecommendationsandmakeitahabitofgivingtheminaconciseandstructured
manner.

Likewise,whenyouaregivingyourrecommendations,bemindfulofthepolitics,
structureandchangecapabilitiesofyourclientsororganization.Inotherwords,
dontrecommendforthesakeofrecommending.However,recommendwhatis
practicalandimplementableassolutions.

Forexample,youcanusea22matrixandputononeaxistheeaseof
implementationandontheotherthefinancialimpactwithinyourtimeframe,say
2or3years.Thus,enhanceyourrecommendationsadoptionandeffectivenessgiven
that,itisadisservicetorecommendsomethingthatisjustniceonpaper,butcantbe
implementedbyyouraudience.

Asalways,applythetoolsandtechniques,bepersistentandconsistent.Yes,the
negativeforceswillopposeyou.However,thestarsofwisdomwillshineforyouas
theytrulydidfortheWISEMENintheEast2000yearsago.

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Tagged in: strategy,problem solving,communication Report this

Cissoko Mamady - Author - Strategy Consultant

Author in Business Strategy | Management Consultant Follow
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3 comments Newest

Leave your thoughts here

Danish Ali 7mo

HR Strategy & Operations
very insightful
Like Reply 1 1

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Back to LinkedIn.com
Cissoko Mamady - Author - Strategy Consultant 7mo
Author in Business Strategy | Management Consultant
Thank you Danish Ali. Stay tuned for other upcoming articles.
Like Reply

Cissoko Mamady - Author - Strategy Consultant 1y

Author in Business Strategy | Management Consultant
Thanks Jume Analyes!
Like Reply

There is 1 other comment.Show more.

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