The 5 WHYs

Description

Five whys (or 5 whys) is an iterative interrogative technique used to explore the cause-and-effect relationships underlying a particular problem.

The primary goal of the technique is to determine the root cause of a defect or problem by repeating the question “Why?”. Each answer forms the basis of the next question. The “five” in the name derives from an anecdotal observation on the number of iterations needed to resolve the problem.

The method provides no hard and fast rules about what lines of questions to explore, or how long to continue the search for additional root causes. Thus, even when the method is closely followed, the outcome still depends upon the knowledge and persistence of the people involved.

Origin

Sakichi Toyoda, the Japanese industrialist, inventor, and founder of Toyota Industries, developed the 5 Whys technique in the 1930s. It became popular in the 1970s, and Toyota still uses it to solve problems today.

Toyota has a “go and see” philosophy. This means that its decision making is based on an in-depth understanding of what’s actually happening on the shop floor , rather than on what someone in a boardroom thinks might be happening.

The 5 Whys technique is true to this tradition, and it is most effective when the answers come from people who have hands-on experience of the process or problem in question.

The method is remarkably simple: when a problem occurs, you drill down to its root cause by asking “Why?” five times. Then, when a counter-measure becomes apparent, you follow it through to prevent the issue from recurring.

Example

Delays in sales in a production company:

  1. Why is the turnover lower by 20% compared with budget?

Because we have delays on 2 major projects.

  1. Why?

Because it takes more time to build the product as normally.

  1. Why?

Because it is a new product and there are new technical requirements which needed to be modified once we moved into production. 

  1. Why?

Because the feasibility of the new technical requirements were not validated beforehand with the production

  1. Why?

Because to reduce the price and satisfy the client’s demand, we changed the design at the last minute without following the normal process of validating these design changes with the production.


Check also this article “The 12 FP&A Principles”.

4 Things to build a sustainable workforce

How do you build a sustainable workforce in your organisation?

Here are 4 things business leaders can do to build a sustainable workforce.

  1. Become advocates for a modernized education system
  2. Implement fluid and seamless learning opportunities
  3. Instill a top-down approach to learning
  4. Take advantage of AI and machine learning to optimize reskilling

Based on the World Economic Forumarticle: https://lnkd.in/ga7RBwK

4 things to build a sustainable workforce - NB

 

 

How to reduce costs?

If you are in a managerial position (even a non-finance one), you should have already encountered the Cost Reduction dilemma.

I recommend you the article of the Harvard Business Review called “When You’ve Got To Cut Costs” which in my opinion will bring you other perspectives and other way to look at the situation.

Here is a quick summary:

Getting to 10%: Incremental Ideas

  1. Consolidate incidentals.
  2. Take overdue personnel actions.
  3. Reduce spending on department management.
  4. Gain control of “miscellaneous” spending.
  5. Hold down pay increases.
  6. Repropose rejected cost-saving ideas.

Getting to 20%: Redesign Ideas

  1. Talk to your counterparties.
  2. Eliminating liaisons and coordinators.
  3. Reducing excessive service levels.
  4. Change the process.
  5. Reduced business requirements.
  6. Manual processes.
  7. Exceptions to the norm.
  8. Timing.
  9. Move away from the belt-and-suspenders mind-set.

Getting to 30% or More: Cross-Department and Program-Elimination Ideas

  1. Coordinate parallel activities.
  2. Shift the burden to the most efficient location.
  3. Eliminate duplicated analysis.
  4. Eliminate low-value meetings and forums.
  5. Restructure or cut cross-department activities.
  6. Eliminate programs.
  7. Reduce the burden you place on others.

Link to the article here: https://hbr.org/2010/05/when-youve-got-to-cut-costs-now

If you liked this post it will mean a lot to me if you share it around. You can also leave a comment below to contribute with your ideas.