9/1/2008 | 4 MINUTE READ

Insight: A Problem-Solving Tool for Problematic Times

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The Japanese have demonstrated that there are simple things that companies can do to improve their performance that do not cost a lot of money to implement.


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The Japanese have demonstrated that there are simple things that companies can do to improve their performance that do not cost a lot of money to implement. What it does require is the investment of some time, patience, and a willingness to keep challenging assumptions. We have been helping U.S. suppliers with one of these practices. The reflection process is a technique that is used for problem-solving, but it is much more. It is a way of thinking through communication by breaking any topic into smaller, clear steps. It is a way of interacting as a group around a common issue, and it is a testament to the value of drawing on the company's human assets.

The reflection process is employed widely at Toyota as a common communication format for a number of purposes-to make a proposal, to give a status report on an initiative, etc.-but problem-solving is probably the area that is the best starting point, with the most concrete evidence of benefits, so we will focus on reflections in that context here.

The purpose of the problem-solving reflection process is to drive organization-wide continuous improvement by using: (1) a thorough, systematic method of understanding and learning from past experience, and (2) a common format (called an 'A3 report' by Japanese companies) to disseminate results through a clear one-page presentation.

How is it done? There are a series of steps that must be executed in order and thoroughly. They appear to be simple, but they are most powerful if done thoughtfully and rigorously, with an underlying attitude that this is an opportunity for positive change and not a punitive blame-laying exercise. A cross-functional team is brought together to work through the following process:

1. Answer the question "What are we trying to do?" A reflection process can go astray because this straightforward question was not addressed and the scope of the issue was not clearly framed.

2. Complete a description of the Problem Situation. The following are the standard elements of this step:

  • Standard: What is the ideal, the target, the way it should work
  • Current situation: An overall statement of the problem and the way in which actual performance or practice is diverging from the standard
  • Discrepancy/extent of the problem: Comparison of actual data to the standard, how often does it happen, what are its implications
  • Importance to our business activity, goals, or values: Why do we care? What impact does it have on us? This is one of the areas where the reflection process, unlike some other problem-solving tools, broadens its perspective to take in the context of the bigger picture.

Establish a Target/Goal for the result of the reflection process, a measurable description of what should be changed as a result of the problem-solving. For example, a company struggling with getting the right part in and the right label on the finished goods box might have a target of 100% accuracy.

4. Conduct a Cause Analysis. This is an honest, open dialogue, often using the technique of asking "why?" five times to get at the root cause for the current failure to meet the standard. It is also helpful to use a structure like a fishbone diagram as a means of ensuring appropriate coverage. A common pitfall to watch out for is that companies are tempted to leap to conclusions or stop too soon before truly understanding all the contributing factors.

5. Identify Countermeasures to adopt-corrective actions that link to the cause analysis and are the result of brainstorming on ways to improve the situation.

6. Implementation. Create a specific plan of "who, what, where, when" that makes it clear what the actions and responsibilities are so anyone can determine whether they are being done. Timing and accountability should be associated with each of the countermeasures.

The final step is to disseminate the results and display them for all to view. Through the use of simple, concise language, graphics, and an 11 x17-in. sheet of paper, the common format of an A3 report summarizes the background information, objectives, analysis, action plans, and expected results on a single sheet of paper. When this technique is used broadly throughout a company, all employees become skilled in reading, understanding, and learning from these reports.

One company that we work with had been told that it was on the verge of losing a significant portion of its booked business because of poor customer service, particularly with regard to quoting. Our client set out to examine the problem using the reflection process, so it started by defining what the standard procedure and time frame should be for responding to a quote in a way that would fit the expectations of the customer. Once it began delving into what was actually occurring, our client discovered a convoluted system of approvals, overlapping communication channels, missing information links, and more, that were affecting not only the disgruntled customer but all customers. The internal systems showed a lack of discipline and an excess of finger-pointing. By working in a cross-functional fashion, the reflection team and its constituents were able to arrive at a consensus on short and long-term steps for improvement. Three months later, our client had gone from being tagged the worst supplier to being rated the Best Supplier based on the scorecard prepared by its customer. What's more, our client learned the value of this collective approach to self-examination and correction-a most constructive, yet simple, activity.