Five Steps in Problem Analysis

Five Steps in
Problem Analysis
© 2015 The Analyst Coach, LLC www.theanalystcoach.net

Step 1: Gain Agreement on
Problem Definition
• One of the simplest ways to gain this agreement is to
simply write the problem down and see whether everyone
agrees.

• Understand benefits of a proposed solution
• Benefits are described in the terms provided by the
customers/users (having the user describe the benefits
provides additional contextual background on the real
problem)

An exercise in gaining agreement on the problem being
solved is necessary.
Assume the development team-defined solution envisioned
a powerful new system that provided:
• Better financial reporting
• Improved invoice and statement formats
• Online parts ordering
• The team eventually hoped to provide the capability for
electronic funds transfer between the company and the
dealer.

Assume that during the problem statement exercise, company
management had the opportunity to provide input.
Management’s vision was substantially different: the primary
goal of the new system was to provide electronic funds transfer
that would improve the cash flow of the company.
The first-order problem to be addressed by the new system was
electronic funds transfer; other dealer communication features
were considered simply “nice to have.”

Step 2: Understand the Root
Causes-The Problem Behind
the Problem
• Once you have an understanding of the larger problem,
your team can use a variety of techniques to gain an
understanding of its causes.
• One option is Root cause analysis, which is a systematic
way of uncovering the root, or underlying, cause of an
identified problem or a symptom of a problem

How do you determine the root causes?
• Asking the people directly involved what they think the
root cause is.
• Perform a detailed investigation of each contributing
problem and to qualify its individual impact.
The goal is to quantify the likely contribution of each root
cause.

Step 3: Identify the
Stakeholders and the Users
• Effectively solving any complex problem typically
involves satisfying the needs of a diverse group of
stakeholders.
• A stakeholder is Anyone who could be materially affected
by the implementation of a new system or application

Stakeholders can be:
• Users of the system
• Indirect users of the system
• Affected only by the business outcomes that the system
influences

An understanding of who these stakeholders are and their particular
needs is an important factor in developing an effective solution.
Depending on the domain expertise of the development team,
identifying the stakeholders may be a trivial or nontrivial step in
problem analysis.
This involves interviewing decision makers, potential users, and other
interested parties. The following questions can be helpful in this
process.
• Who are the users of the system?
• Who is the customer (economic buyer) for the system?
• Who else will be affected by the outputs the system produces?
• Who will evaluate and approve the system when it is delivered and
deployed?
• Are there any other internal or external users of the system whose
needs must be addressed?
• Who will maintain the new system?
• Is there anyone else who cares?

Step 4: Define the Solution
System Boundary
• The system boundary defines the border between the
solution and the real world that surrounds the solution
• All interactions with the system occur via interfaces
between the system and the external world.
• If we are going to have to build it or modify it, it’s part of
our solution and within the boundary; if not, it’s external
to our system.

An actor is “Someone or something outside the system that
interacts with the system”
Identifying Actors:
• Who will supply, use, or remove information from the
system?
• Who will operate the system?
• Who will perform any system maintenance?
• Where will the system be used?
• Where does the system get its information?
• What other external systems will interact with the
system?

Step 5: Identify the
Constraints to be imposed
on the Solution
Consider the constraints that will be imposed on the solution.
We’ll define a constraint as:
A restriction on the degree of freedom we have in providing a
solution
Each constraint has the potential to severely restrict our ability to
deliver a solution as we envision it.

Sources of constraints:
• Schedule
• Return on investment
• Budget for labor and equipment
• Environmental issues
• Operating systems
• Databases
• Hosts and client systems
• Technical issues
• Political issues within the organization
• Purchased software
• Company policies and procedures
• Choices of tools and languages
• Personnel or other resource constraints

Potential Sources
As an aid to elicitation, it would be helpful to know what
kinds of things we should be looking for. The following list
shows potential sources of system constraints.

Economics
• What financial or budgetary constraints apply?
• Are there costs of goods sold or any product pricing considerations?
• Are there any licensing issues?
Politics
• Do internal or external political issues affect potential solutions?
• Are there any interdepartmental problems or issues?
Technology
• Are we restricted in our choice of technologies?
• Are we constrained to work within existing platforms or technologies?
• Are we prohibited from using any new technologies?
• Are we expected to use any purchased software packages?
Systems
• Is the solution to be built on our existing systems?
• Must we maintain compatibility with existing solutions?
• What operating systems and environments must be supported?
Environment
• Are their environmental or regulatory constraints?
• Are there legal constraints?
• What are the security requirements?
• What other standards might restrict us?
Schedule and Resources
• Is the schedule defined?
• Are we restricted to existing resources?
• Can we use outside labor?
• Can we expand resources? Temporarily? Permanently?

• Once identified, some of these constraints will become
requirements for the new system (for example “use the
Materials Requirements Planning system provided via
our current accounting system vendor”).
• Other constraints will affect resources, implementation
plans, and project pans. It is the problem solver’s
responsibility to understand the potential sources of
constraints for each specific application environment and
to determine the impact of each constraint on the
potential solution spaces.

Constraint Examples
Sources of Constraints and Their Rationale for Sales Order Entry System
Operations
• An exact copy of sales order data must remain on the legacy database for up to one year.
• The risk of data loss is too great; we will need to run in parallel for three months.
Systems
• The applications footprint on the server must be less than 20MB.
• We have limited server memory available.
Equipment Budget
• The system must be developed on the existing server and host; new client hardware for users
may be provided.
• We need to control costs and maintain the existing systems.
Personnel Budget
• Staffing resources are fixed; no outsourcing is possible.
• The current budget calls for fixed operating costs.
Technology Mandate
• A new object-oriented methodology should be used.
• We believe that this technology will increase productivity and increase the reliability of the
software.

Summary
After completing this problem analysis activity, we can be
reasonably confident that we have:
• A good understanding of the problem to be solved and the root
causes of the problem
• Proper identification of the stakeholders whose collective
judgment will ultimately determine the success or failure of
our system
• An understanding of where the boundaries of the solution are
likely to be found
• An understanding of the constraints and the degrees of
freedom we have to solve the problem

Let’s Talk
• Interested in learning more about problem analysis or
another area of business analysis?
• You can contact me at teresa@theanalystcoach.net or 1-
866-968-6657.

Five Steps in Problem Analysis

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