Why Issues Analysis Is Important?
Working as a business consultant, you have the opportunity to work on issue analysis and problem-solving for clients. We do provide individual solutions, but in most cases what is missing is how we perform issue analysis in the early stage of the decision-making process. If you can’t make the cause of the issue appropriately then your choice may not work. We also have to keep in mind the iceberg of ignorance theory. Top management knows only 4% of an organisation’s frontline problems, 9% are known by middle management, 74% of supervisors and 100% by employees. Top Management thinks they know what is going on in their organisation. However they don’t both in good ways and bad ways. Therefore it is important for them to understand comprehensively and visualise the fact to come up with the solution that works best for the organisation.
Clients Do Not Tell You The Problem
Either you work for as an internal consultant or external consultant, you will perform interviews with customers to understand what they are facing as an issue. They will talk hours and hours about complaints about other department and how well they are filling all the rules and guidelines to execute their responsibilities in the organisation. Sometimes it even gets worse that we hear the negative relationship between individuals. As you write what you have heard during the interview session, do not evaluate our give you opinion in the first round. This is because everything you are hearing may not be critical for their business. Especially the first interview session, clients will not tell you what the real issue. Therefore keep that in mind and focus on what they are doing, not on how they feel about the situation.
Associate To Disassociate
When consultants interview clients and analyse issues, what we are doing is to see things from different perspectives. If I were to explain in a very simple manner, it is to disassociate from the issue and see it from different angles. This process enables us to view the problem in a different way. It can be a problem, or it may not be a problem. Sometimes the priority for can be different. Issue analysis and making business decisions is not easy because there is no answer. Even though you hire a consultant, does not mean you always have the best answer. What we help clients is to see things differently and assist them to make the decision and move on rather than taking so much time analysing or collecting facts.
3 Perspective of Issue Analysis
The three perspective of analysis that we use is from a corporate perspective, management perspective and operating perspective. Corporate perspective is the view from top management.
Senior management has the assumption of the market and the business scheme or business model. Also, they focus on the financial KPIs that is important for the stakeholders of the company.
Management perspective is the view from middle management. Middle managers deal with top management and also operators. They need to address a different type of communication method because senior management and players will have an entirely different way of viewing their work.
Operating perspective is the view from staffs and employees who execute their roles in responsibilities in the organisation. They deal with the day to day activity to purchase, sell, manage business activities.
What Executives Think From Corporate Perspective
Company A is selling medical products and cosmetic products. They have long been in business for medical products and one of the top companies in this market. They have started the cosmetics products a few years back and trying to explore business growth in this market. As the CEO reviews the financial report, he recognised two things. Medical products are performing as expected, and cosmetic products are growing as well. However, as the profit is over the budget. The CEO was confident in his products. He thought the sales are spending too much money on the marketing and not increasing the sales and profit. He had talked with the sales managers, but he still does not understand why it takes so much effort to sell the product. So he decides to call a meeting with the sales manager of cosmetic product division and discuss the sales marketing cost.
Managers are Stuck in the Middle
Sales Managers were all nervous that the CEO decided to hold the meeting with them regarding the sales operation cost. They already knew that the discussion was about the cost so they have prepared some slides to provide some feedback on the current status and how they can reduce the cost. As the meeting went by CEO did mention about the sales and profit of the cosmetic products and how he thinks he can improve that situation. Sales managers focused on the cost as they thought they are doing enough for the sales. The only portion remaining for the sales to reduce cost was marketing cost. The CEO was pleased to hear the sales have some idea to lower the cost to gain more profit.
Idea and Facts are at the Ground Level
Sales staff were all busy every day because they are still not used to this market. Sales team did not have experience in the cosmetic market. They took time to identify which product line will suit for the retail store. The Sales Tem did not have enough knowledge, so it was taking them a lot of time to close each deal. One of the sales found that a global distributor just joins the market to expand their business in cosmetics. They had the knowledge and distribution channels to cover to some of the large retailers for department stores. The sales staff wanted to discuss with the Manager. After coming back, he was called by the Manager in an urgent employees meeting and announced the marketing cost reduction. As you can imagine he couldn’t discuss about the aliance with distributor.
Communication Gap Occurs Easily Than You Think
What is the issue with Company A? When we perform issue analysis, we will not be able to foresee all the situations. However, we do predict that this situation can easily occur in a group. Therefore, we do ask during the interview what kind of questions or directions they gave. Most of the cases there is miscommunication. Issue analysis starts with understanding that there will always be a miscommunication in the organisation and how people interpret and how they take action can lead the organisation to move towards a different direction. In this case, the CEO did not intend just to reduce the cost; he could have accepted the option to increase sales more and minimise the cost increase. However, when the direction came from the Management to Operating Team, they were only focusing on cost reduction.
Start With Executive Interview
We often start our interview session with Executives, as they view the company much different from the majority of the people in the organisation. It is important to see what kind of personalities they have. If you meet a person who talks and directs thing a lot, then you may have a lot of issues in this organisation. Ask different types of questions, such as what is the companies primary focus regarding achieving business targets? Even Executives will talk about the day to day issues or how the team does not perform up to his or her expectation. We want to understand not the external things that are affecting the CEO but more about the target, what he sees and the priority.
Use Different Perspective in Managers Interview
During the manager’s interview, give them how the Executive views the situation. You will get the Managers attention because his focus is towards how the Executives see them. Then change to the view of operating staffs and observe whether the Managers feel that there is a gap between what is expected from a corporate perspective and what he is getting as a sign from operating perspective. Issue analysis is about bridging this gap between organisation. We first set the hypothesis that every team face this problem because they see everything associated with them and eliminate information which can be very beneficial.
Issue Analysis is About Viewing Things From Different Aspect
The three perspective of issue analysis is useful because you can do this in your daily work. If you have a chance to talk with people from each perspective, you will recognise that they have a different understanding. To see from CEO’s point of view is one way to visualise your company from a corporate perspective. Viewing from managers perspective is also important as they are the wheels and steering to drive the car towards the location you want to go. If you can train your people to see things from each of these perspectives, the communication level in your organisation will significantly improve. Issue analysis and discussion to resolve these matters can be done in the daily conversation. This will allow you to have less chance of miscommunication.