This is a great post from Matthew E. May on Root Cause Analysis.
Boot Your Root (Cause)
Thursday, June 4th, 2015
Process improvers the world over rally around root cause analysis as if it were the Holy Grail of all things organizational. But is it?
Understanding the root cause of a problem certainly makes sense in the context of a present day situation carrying the potential for a correct answer or solution. In the process improvement world, problems center on reducing some form of excess, which comes in several traditional flavors…all of which center on something not working as well as it should be in a perfect world.
But the one critical place in business where root cause analysis has no real place is in strategy formulation.
I’m sure I’ll be taken to task on this by the lean/kaizen/six sigma crowd, but bear with me, because I’ve witnessed repeated attempts to apply root cause analysis to strategy, only to be met with derailment and eventual failure.
The difference between a fix for an existing process or pain point and a set of choices about the future is night and day. Process problems are generally focused inward on activities you presently control. Strategic problems are generally focused outward on the future, and forces you cannot control. In process improvement, you’re pursuing perfection. In strategy formulation, there’s no such thing as a perfect strategy, so you couldn’t pursue one even if you wanted to.
If I own a traditional taxi or limo company, for example, I don’t need to know specifically why Uber entered my market, only that they did, and that my market share is dwindling and my growth and profitability is eroding.
Looked at another way, all strategic problems boil down to a single root cause: customers are finding superior value elsewhere, from a competing offer.
This may seem blazingly obvious. But that doesn’t seem to deter organizations (and their consultants) from applying traditional problem solving to strategy development, spiraling ever downward in an endless series of “why?” questions. The result is an emphasis on drafting a perfect plan and a futile attempt to craft a detailed articulation of the perfect future for the company.
It’s unnecessary, mostly irrelevant, and doesn’t work.
Click here to read the post on Matthew E. May’s blog: http://matthewemay.com/boot-your-root-cause/