A 9 step method for deciding when or if to fix a business problem
by Tron Jordheim
In my time as a manager of businesses and as a consultant I often run into a business problem that I or the group involved may or may not want to tackle. Sometimes you decide to leave a big problem alone and sometimes you decide to fix a little problem immediately and with gusto.
How do you know which way to decide?
I’ll lay out for you a framework you can use to decide when to deal with the problem.
You see an opportunity to fix a problem, or you see a department or function or work flow that is not performing as well as you think it should. Or you might be getting complaints from others in the organization that project Y is not working right. You decide you have a problem Now what?
1. Do you have bigger fish to fry? More urgent problems, fixes with bigger payback numbers attached to them, or larger issues will always take the front seat. Just don’t wait too long, because a smaller problem may just be the start of a really big one. Are you thinking of putting off this fix just to have less to do, or are you making a sound business decision to leave it alone for now?
2. Is revenue growing nicely in spite of the problem. Maybe the problem doesn’t hurt revenue growth and it is something you can wait to deal with until later. How does the problem area impact revenue and profit? Maybe you can’t justify the investment in the fix?
3. How much increased revenue and profit could a fix bring? If you could gain a 10% increase in revenue and a 7% increase in profit in a multi million dollar project, you may be hard pressed to find a better use of your time than fixing this situation. What is the drag on revenue that the current problem represents? Maybe you can’t justify a fix by the increase in revenue it would bring, but maybe freeing up a drag on revenue would be very valuable.
4. Is the current state of affairs harmless or corrosive? Maybe the current state is just inefficient or sloppy or shooting at too low of a goal, but not hurting anything in the big picture. Maybe the problem is rotting your morale, chasing off potential customers, causing unnecessary employee turnover, bleeding costs, and nothing but frustration for managers. If the people living with the broken system every day are okay with working in a broken system, and comfortable with the work-arounds and the inefficiencies, maybe you can be fine with it too.
5. How much of a lynch pin is this project in relation to other things? If it is crucial to other functions and impacts lots of other business units, you may not be able to afford to wait. If it does not impact other efforts much, maybe you can wait. Take another look at your business ecosystem. Sometimes the ecosystem is more dependent on the problem area than you might have originally thought.
6. Will a fix here help or hurt related links in the chain? Sometimes a fix in one point of the business flow will interrupt another and cause a chain effect of problems needing a fix. Sometimes a small fix will make everything flow much more smoothly and end up becoming a significant fix to the whole organization. Sometimes a unit lives in some isolation and won’t throw a lot of effect across the organization. Are you throwing the whole organization off balance with a fix here, or are you helping the organization run more smoothly?
7. Do you have the bandwidth to do the fix and keep the fix fixed? Sometimes you do not have the capability of making the fix or of keeping the fix on track and maintained. If you can’t finish the repair and keep the system well maintained after the fix, you might be making a bigger problem for the future than the one you had in the past.
8.Do you know all the caveats, asterisks and biases involved in doing this analysis. By now you should know that all data you are collecting is flawed by being incomplete, unreliable, unrelated, or inaccurate. Using data that has a low trustworthiness is fine, if you are not trusting it much. Are you being honest about all the biases you and others looking at the data use as your filters? Make sure you are not making decisions based on flawed data, poorly done analysis or a bias that does not apply to reality. We get wrapped up in our assumptions. Make sure you are aware of this and double and triple check yourself.
9. Do you have the right people and process for making the fix and seeing it through to completion and getting it on a solid maintenance routine? Picking the wrong consultants, managers and teams to work on a fix is worse than no fix at all. Planning, preparation, goal setting, brainstorming, and careful selection of people have to be done right. You know the saying about measuring twice and cutting once. Maybe it is better to measure ten times before making the cut.
Finally, after all of this you can decide if you should fix the problem now or forget about it until some later time.