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10 Step Process for Effective Business Problem Solving

Posted august 3, 2021 by harriet genever.

Navigate uncertainty by following this 10-step process to develop your problem-solving skills and approach any issue with confidence. 

When you start a small business or launch a startup, the one thing you can count on is the unexpected. No matter how thoroughly you plan, forecast , and test, problems are bound to arise. This is why as an entrepreneur, you need to know how to solve business problems effectively.

What is problem solving in business?

Problem solving in business relates to establishing processes that mitigate or remove obstacles currently preventing you from reaching strategic goals . These are typically complex issues that create a gap between actual results and your desired outcome. They may be present in a single team, operational process, or throughout your entire organization, typically without an immediate or obvious solution. 

To approach problem solving successfully, you need to establish consistent processes that help you evaluate, explore solutions, prioritize execution, and measure success. In many ways, it should be similar to how you review business performance through a monthly plan review . You work through the same documentation, look for gaps, dig deeper to identify the root cause, and hash out options. Without this process, you simply cannot expect to solve problems efficiently or effectively. 

Why problem solving is important for your business

While some would say problem-solving comes naturally, it’s actually a skill you can grow and refine over time. Problem solving skills will help you and your team tackle critical issues and conflicts as they arise. It starts from the top. You as the business owner or CEO needing to display the type of level-headed problem solving that you expect to see from your employees.

Doing so will help you and your staff quickly deal with issues, establish and refine a problem solving process, turn challenges into opportunities, and generally keep a level head. Now, the best business leaders didn’t just find a magic solution to solve their problems, they built processes and leveraged tools to find success. And you can do the same.

By following this 10-step process, you can develop your problem-solving skills and approach any issue that arises with confidence. 

1. Define the problem

When a problem arises, it can be very easy to jump right into creating a solution. However, if you don’t thoroughly examine what led to the problem in the first place, you may create a strategy that doesn’t actually solve it. You may just be treating the symptoms.

For instance, if you realize that your sales from new customers are dropping, your first inclination might be to rush into putting together a marketing plan to increase exposure. But what if decreasing sales are just a symptom of the real problem? 

When you define the problem, you want to be sure you’re not missing the forest for the trees. If you have a large issue on your hands, you’ll want to look at it from several different angles:


Is a competitor’s promotion or pricing affecting your sales? Are there new entrants in your market? How are they marketing their product or business?

Business model 

Is your business model sustainable? Is it realistic for how fast you want to grow? Should you explore different pricing or cost strategies?

Market factors

How are world events and the nation’s economy affecting your customers and your sales?

Are there any issues affecting your team? Do they have the tools and resources they need to succeed? 

Goal alignment 

Is everyone on your team working toward the same goal ? Have you communicated your short-term and long-term business goals clearly and often?

There are a lot of ways to approach the issue when you’re facing a serious business problem. The key is to make sure you’re getting a full snapshot of what’s going on so you don’t waste money and resources on band-aid solutions. 

Going back to our example, by looking at every facet of your business, you may discover that you’re spending more on advertising than your competitors already. And instead, there’s a communication gap within your team that’s leading to the mishandling of new customers and therefore lost sales. 

If you jumped into fixing the exposure of your brand, you would have been dumping more money into an area you’re already winning. Potentially leading to greater losses as more and more new customers are dropped due to poor internal communication.

This is why it’s so vital that you explore your blind spots and track the problem to its source.

2. Conduct a SWOT analysis

All good businesses solve some sort of problem for customers. What if your particular business problem is actually an opportunity, or even a strength if considered from a different angle? This is when you’d want to conduct a SWOT analysis to determine if that is in fact the case.

SWOT is a great tool for strategic planning and bringing multiple viewpoints to the table when you’re looking at investing resources to solve a problem. This may even be incorporated in your attempts to identify the source of your problem, as it can quickly outline specific strengths and weaknesses of your business. And then by identifying any potential opportunities or threats, you can utilize your findings to kickstart a solution. 

3. Identify multiple solutions with design thinking

As you approach solving your problem, you may want to consider using the design thinking approach . It’s often used by organizations looking to solve big, community-based problems. One of its strengths is that it requires involving a wide range of people in the problem-solving process. Which leads to multiple perspectives and solutions arising.

This approach—applying your company’s skills and expertise to a problem in the market—is the basis for design thinking.

It’s not about finding the most complex problems to solve, but about finding common needs within the organization and in the real world and coming up with solutions that fit those needs. When you’re solving business problems, this applies in the sense that you’re looking for solutions that address underlying issues—you’re looking at the big picture.

4. Conduct market research and customer outreach

Market research and customer outreach aren’t the sorts of things small business owners and startups can do once and then cross off the list. When you’re facing a roadblock, think back to the last time you did some solid market research or took a deep dive into understanding the competitive landscape .

Market research and the insights you get from customer outreach aren’t a silver bullet. Many companies struggle with what they should do with conflicting data points. But it’s worth struggling through and gathering information that can help you better understand your target market . Plus, your customers can be one of the best sources of criticism. It’s actually a gift if you can avoid taking the negatives personally .

The worst thing you can do when you’re facing challenges is isolating yourself from your customers and ignore your competition. So survey your customers. Put together a competitive matrix . 

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5. Seek input from your team and your mentors

Don’t do your SWOT analysis or design thinking work by yourself. The freedom to express concerns, opinions, and ideas will allow people in an organization to speak up. Their feedback is going to help you move faster and more efficiently. If you have a team in place, bring them into the discussion. You hired them to be experts in their area; use their expertise to navigate and dig deeper into underlying causes of problems and potential solutions.

If you’re running your business solo, at least bring in a trusted mentor. SCORE offers a free business mentorship program if you don’t already have one. It can also be helpful to connect with a strategic business advisor , especially if business financials aren’t your strongest suit.

Quoting Stephen Covey, who said that “strength lies in differences, not in similarities,” speaking to the importance of diversity when it comes to problem-solving in business. The more diverse a team is , the more often innovative solutions to the problems faced by the organization appear.

In fact, it has been found that groups that show greater diversity were better at solving problems than groups made up specifically of highly skilled problem solvers. So whoever you bring in to help you problem-solve, resist the urge to surround yourself with people who already agree with you about everything.

6. Apply lean planning for nimble execution

So you do your SWOT analysis and your design thinking exercise. You come up with a set of strong, data-driven ideas. But implementing them requires you to adjust your budget, or your strategic plan, or even your understanding of your target market.

Are you willing to change course? Can you quickly make adjustments? Well in order to grow, you can’t be afraid to be nimble . 

By adopting the lean business planning method —the process of revising your business strategy regularly—you’ll be able to shift your strategies more fluidly. You don’t want to change course every week, and you don’t want to fall victim to shiny object thinking. But you can strike a balance that allows you to reduce your business’s risk while keeping your team heading in the right direction.

Along the way, you’ll make strategic decisions that don’t pan out the way you hoped. The best thing you can do is test your ideas and iterate often so you’re not wasting money and resources on things that don’t work. That’s Lean Planning .

7. Model different financial scenarios

When you’re trying to solve a serious business problem, one of the best things you can do is build a few different financial forecasts so you can model different scenarios. You might find that the idea that seemed the strongest will take longer than you thought to reverse a negative financial trend. At the very least you’ll have better insight into the financial impact of moving in a different direction.

The real benefit here is looking at different tactical approaches to the same problem. Maybe instead of increasing sales right now, you’re better off in the long run if you adopt a strategy to reduce churn and retain your best customers. You won’t know unless you model a few different scenarios. You can do this by using spreadsheets, and a tool like LivePlan can make it easier and quicker.

8. Watch your cash flow

While you’re working to solve a challenging business problem, pay particular attention to your cash flow and your cash flow forecast . Understanding when your company is at risk of running out of cash in the bank can help you be proactive. It’s a lot easier to get a line of credit while your financials still look good and healthy, than when you’re one pay period away from ruin.

If you’re dealing with a serious issue, it’s easy to start to get tunnel vision. You’ll benefit from maintaining a little breathing room for your business as you figure out what to do next.

9. Use a decision-making framework

Once you’ve gathered all the information you need, generated a number of ideas, and done some financial modeling, you might still feel uncertain. It’s natural—you’re not a fortune-teller. You’re trying to make the best decision you can with the information you have.

This article offers a really useful approach to making decisions. It starts with putting your options into a matrix like this one:

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Use this sort of framework to put everything you’ve learned out on the table. If you’re working with a bigger team, this sort of exercise can also bring the rest of your team to the table so they feel some ownership over the outcome.

10. Identify key metrics to track

How will you know your problem is solved? And not just the symptom—how will you know when you’ve addressed the underlying issues? Before you dive into enacting the solution, make sure you know what success looks like.

Decide on a few key performance indicators . Take a baseline measurement, and set a goal and a timeframe. You’re essentially translating your solution into a plan, complete with milestones and goals. Without these, you’ve simply made a blind decision with no way to track success. You need those goals and milestones to make your plan real .

Problem solving skills to improve

As you and your team work through this process, it’s worth keeping in mind specific problem solving skills you should continue to develop. Bolstering your ability, as well as your team, to solve problems effectively will only make this process more useful and efficient. Here are a few key skills to work on.

Emotional intelligence

It can be very easy to make quick, emotional responses in a time of crisis or when discussing something you’re passionate about. To avoid making assumptions and letting your emotions get the best of you, you need to focus on empathizing with others. This involves understanding your own emotional state, reactions and listening carefully to the responses of your team. The more you’re able to listen carefully, the better you’ll be at asking for and taking advice that actually leads to effective problem solving.

Jumping right into a solution can immediately kill the possibility of solving your problem. Just like when you start a business , you need to do the research into what the problem you’re solving actually is. Luckily, you can embed research into your problem solving by holding active reviews of financial performance and team processes. Simply asking “What? Where? When? How?” can lead to more in-depth explorations of potential issues.

The best thing you can do to grow your research abilities is to encourage and practice curiosity. Look at every problem as an opportunity. Something that may be trouble now, but is worth exploring and finding the right solution. You’ll pick up best practices, useful tools and fine-tune your own research process the more you’re willing to explore.


Creatively brainstorming with your team is somewhat of an art form. There needs to be a willingness to throw everything at the wall and act as if nothing is a bad idea at the start. This style of collaboration encourages participation without fear of rejection. It also helps outline potential solutions outside of your current scope, that you can refine and turn into realistic action.

Work on breaking down problems and try to give everyone in the room a voice. The more input you allow, the greater potential you have for finding the best solution.


One thing that can drag out acting upon a potential solution, is being indecisive. If you aren’t willing to state when the final cutoff for deliberation is, you simply won’t take steps quickly enough. This is when having a process for problem solving comes in handy, as it purposefully outlines when you should start taking action.

Work on choosing decision-makers, identify necessary results and be prepared to analyze and adjust if necessary. You don’t have to get it right every time, but taking action at the right time, even if it fails, is almost more vital than never taking a step.  

Stemming off failure, you need to learn to be resilient. Again, no one gets it perfect every single time. There are so many factors in play to consider and sometimes even the most well-thought-out solution doesn’t stick. Instead of being down on yourself or your team, look to separate yourself from the problem and continue to think of it as a puzzle worth solving. Every failure is a learning opportunity and it only helps you further refine and eliminate issues in your strategy.

Problem solving is a process

The key to effective problem-solving in business is the ability to adapt. You can waste a lot of resources on staying the wrong course for too long. So make a plan to reduce your risk now. Think about what you’d do if you were faced with a problem large enough to sink your business. Be as proactive as you can.

Editor’s note: This article was originally published in 2016. It was updated in 2021.

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Harriet Genever

Harriet Genever

Posted in management, join over 1 million entrepreneurs who found success with liveplan.

How to master the seven-step problem-solving process

In this episode of the McKinsey Podcast , Simon London speaks with Charles Conn, CEO of venture-capital firm Oxford Sciences Innovation, and McKinsey senior partner Hugo Sarrazin about the complexities of different problem-solving strategies.

Podcast transcript

Simon London: Hello, and welcome to this episode of the McKinsey Podcast , with me, Simon London. What’s the number-one skill you need to succeed professionally? Salesmanship, perhaps? Or a facility with statistics? Or maybe the ability to communicate crisply and clearly? Many would argue that at the very top of the list comes problem solving: that is, the ability to think through and come up with an optimal course of action to address any complex challenge—in business, in public policy, or indeed in life.

Looked at this way, it’s no surprise that McKinsey takes problem solving very seriously, testing for it during the recruiting process and then honing it, in McKinsey consultants, through immersion in a structured seven-step method. To discuss the art of problem solving, I sat down in California with McKinsey senior partner Hugo Sarrazin and also with Charles Conn. Charles is a former McKinsey partner, entrepreneur, executive, and coauthor of the book Bulletproof Problem Solving: The One Skill That Changes Everything [John Wiley & Sons, 2018].

Charles and Hugo, welcome to the podcast. Thank you for being here.

Hugo Sarrazin: Our pleasure.

Charles Conn: It’s terrific to be here.

Simon London: Problem solving is a really interesting piece of terminology. It could mean so many different things. I have a son who’s a teenage climber. They talk about solving problems. Climbing is problem solving. Charles, when you talk about problem solving, what are you talking about?

Charles Conn: For me, problem solving is the answer to the question “What should I do?” It’s interesting when there’s uncertainty and complexity, and when it’s meaningful because there are consequences. Your son’s climbing is a perfect example. There are consequences, and it’s complicated, and there’s uncertainty—can he make that grab? I think we can apply that same frame almost at any level. You can think about questions like “What town would I like to live in?” or “Should I put solar panels on my roof?”

You might think that’s a funny thing to apply problem solving to, but in my mind it’s not fundamentally different from business problem solving, which answers the question “What should my strategy be?” Or problem solving at the policy level: “How do we combat climate change?” “Should I support the local school bond?” I think these are all part and parcel of the same type of question, “What should I do?”

I’m a big fan of structured problem solving. By following steps, we can more clearly understand what problem it is we’re solving, what are the components of the problem that we’re solving, which components are the most important ones for us to pay attention to, which analytic techniques we should apply to those, and how we can synthesize what we’ve learned back into a compelling story. That’s all it is, at its heart.

I think sometimes when people think about seven steps, they assume that there’s a rigidity to this. That’s not it at all. It’s actually to give you the scope for creativity, which often doesn’t exist when your problem solving is muddled.

Simon London: You were just talking about the seven-step process. That’s what’s written down in the book, but it’s a very McKinsey process as well. Without getting too deep into the weeds, let’s go through the steps, one by one. You were just talking about problem definition as being a particularly important thing to get right first. That’s the first step. Hugo, tell us about that.

Hugo Sarrazin: It is surprising how often people jump past this step and make a bunch of assumptions. The most powerful thing is to step back and ask the basic questions—“What are we trying to solve? What are the constraints that exist? What are the dependencies?” Let’s make those explicit and really push the thinking and defining. At McKinsey, we spend an enormous amount of time in writing that little statement, and the statement, if you’re a logic purist, is great. You debate. “Is it an ‘or’? Is it an ‘and’? What’s the action verb?” Because all these specific words help you get to the heart of what matters.

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Simon London: So this is a concise problem statement.

Hugo Sarrazin: Yeah. It’s not like “Can we grow in Japan?” That’s interesting, but it is “What, specifically, are we trying to uncover in the growth of a product in Japan? Or a segment in Japan? Or a channel in Japan?” When you spend an enormous amount of time, in the first meeting of the different stakeholders, debating this and having different people put forward what they think the problem definition is, you realize that people have completely different views of why they’re here. That, to me, is the most important step.

Charles Conn: I would agree with that. For me, the problem context is critical. When we understand “What are the forces acting upon your decision maker? How quickly is the answer needed? With what precision is the answer needed? Are there areas that are off limits or areas where we would particularly like to find our solution? Is the decision maker open to exploring other areas?” then you not only become more efficient, and move toward what we call the critical path in problem solving, but you also make it so much more likely that you’re not going to waste your time or your decision maker’s time.

How often do especially bright young people run off with half of the idea about what the problem is and start collecting data and start building models—only to discover that they’ve really gone off half-cocked.

Hugo Sarrazin: Yeah.

Charles Conn: And in the wrong direction.

Simon London: OK. So step one—and there is a real art and a structure to it—is define the problem. Step two, Charles?

Charles Conn: My favorite step is step two, which is to use logic trees to disaggregate the problem. Every problem we’re solving has some complexity and some uncertainty in it. The only way that we can really get our team working on the problem is to take the problem apart into logical pieces.

What we find, of course, is that the way to disaggregate the problem often gives you an insight into the answer to the problem quite quickly. I love to do two or three different cuts at it, each one giving a bit of a different insight into what might be going wrong. By doing sensible disaggregations, using logic trees, we can figure out which parts of the problem we should be looking at, and we can assign those different parts to team members.

Simon London: What’s a good example of a logic tree on a sort of ratable problem?

Charles Conn: Maybe the easiest one is the classic profit tree. Almost in every business that I would take a look at, I would start with a profit or return-on-assets tree. In its simplest form, you have the components of revenue, which are price and quantity, and the components of cost, which are cost and quantity. Each of those can be broken out. Cost can be broken into variable cost and fixed cost. The components of price can be broken into what your pricing scheme is. That simple tree often provides insight into what’s going on in a business or what the difference is between that business and the competitors.

If we add the leg, which is “What’s the asset base or investment element?”—so profit divided by assets—then we can ask the question “Is the business using its investments sensibly?” whether that’s in stores or in manufacturing or in transportation assets. I hope we can see just how simple this is, even though we’re describing it in words.

When I went to work with Gordon Moore at the Moore Foundation, the problem that he asked us to look at was “How can we save Pacific salmon?” Now, that sounds like an impossible question, but it was amenable to precisely the same type of disaggregation and allowed us to organize what became a 15-year effort to improve the likelihood of good outcomes for Pacific salmon.

Simon London: Now, is there a danger that your logic tree can be impossibly large? This, I think, brings us onto the third step in the process, which is that you have to prioritize.

Charles Conn: Absolutely. The third step, which we also emphasize, along with good problem definition, is rigorous prioritization—we ask the questions “How important is this lever or this branch of the tree in the overall outcome that we seek to achieve? How much can I move that lever?” Obviously, we try and focus our efforts on ones that have a big impact on the problem and the ones that we have the ability to change. With salmon, ocean conditions turned out to be a big lever, but not one that we could adjust. We focused our attention on fish habitats and fish-harvesting practices, which were big levers that we could affect.

People spend a lot of time arguing about branches that are either not important or that none of us can change. We see it in the public square. When we deal with questions at the policy level—“Should you support the death penalty?” “How do we affect climate change?” “How can we uncover the causes and address homelessness?”—it’s even more important that we’re focusing on levers that are big and movable.

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Simon London: Let’s move swiftly on to step four. You’ve defined your problem, you disaggregate it, you prioritize where you want to analyze—what you want to really look at hard. Then you got to the work plan. Now, what does that mean in practice?

Hugo Sarrazin: Depending on what you’ve prioritized, there are many things you could do. It could be breaking the work among the team members so that people have a clear piece of the work to do. It could be defining the specific analyses that need to get done and executed, and being clear on time lines. There’s always a level-one answer, there’s a level-two answer, there’s a level-three answer. Without being too flippant, I can solve any problem during a good dinner with wine. It won’t have a whole lot of backing.

Simon London: Not going to have a lot of depth to it.

Hugo Sarrazin: No, but it may be useful as a starting point. If the stakes are not that high, that could be OK. If it’s really high stakes, you may need level three and have the whole model validated in three different ways. You need to find a work plan that reflects the level of precision, the time frame you have, and the stakeholders you need to bring along in the exercise.

Charles Conn: I love the way you’ve described that, because, again, some people think of problem solving as a linear thing, but of course what’s critical is that it’s iterative. As you say, you can solve the problem in one day or even one hour.

Charles Conn: We encourage our teams everywhere to do that. We call it the one-day answer or the one-hour answer. In work planning, we’re always iterating. Every time you see a 50-page work plan that stretches out to three months, you know it’s wrong. It will be outmoded very quickly by that learning process that you described. Iterative problem solving is a critical part of this. Sometimes, people think work planning sounds dull, but it isn’t. It’s how we know what’s expected of us and when we need to deliver it and how we’re progressing toward the answer. It’s also the place where we can deal with biases. Bias is a feature of every human decision-making process. If we design our team interactions intelligently, we can avoid the worst sort of biases.

Simon London: Here we’re talking about cognitive biases primarily, right? It’s not that I’m biased against you because of your accent or something. These are the cognitive biases that behavioral sciences have shown we all carry around, things like anchoring, overoptimism—these kinds of things.

Both: Yeah.

Charles Conn: Availability bias is the one that I’m always alert to. You think you’ve seen the problem before, and therefore what’s available is your previous conception of it—and we have to be most careful about that. In any human setting, we also have to be careful about biases that are based on hierarchies, sometimes called sunflower bias. I’m sure, Hugo, with your teams, you make sure that the youngest team members speak first. Not the oldest team members, because it’s easy for people to look at who’s senior and alter their own creative approaches.

Hugo Sarrazin: It’s helpful, at that moment—if someone is asserting a point of view—to ask the question “This was true in what context?” You’re trying to apply something that worked in one context to a different one. That can be deadly if the context has changed, and that’s why organizations struggle to change. You promote all these people because they did something that worked well in the past, and then there’s a disruption in the industry, and they keep doing what got them promoted even though the context has changed.

Simon London: Right. Right.

Hugo Sarrazin: So it’s the same thing in problem solving.

Charles Conn: And it’s why diversity in our teams is so important. It’s one of the best things about the world that we’re in now. We’re likely to have people from different socioeconomic, ethnic, and national backgrounds, each of whom sees problems from a slightly different perspective. It is therefore much more likely that the team will uncover a truly creative and clever approach to problem solving.

Simon London: Let’s move on to step five. You’ve done your work plan. Now you’ve actually got to do the analysis. The thing that strikes me here is that the range of tools that we have at our disposal now, of course, is just huge, particularly with advances in computation, advanced analytics. There’s so many things that you can apply here. Just talk about the analysis stage. How do you pick the right tools?

Charles Conn: For me, the most important thing is that we start with simple heuristics and explanatory statistics before we go off and use the big-gun tools. We need to understand the shape and scope of our problem before we start applying these massive and complex analytical approaches.

Simon London: Would you agree with that?

Hugo Sarrazin: I agree. I think there are so many wonderful heuristics. You need to start there before you go deep into the modeling exercise. There’s an interesting dynamic that’s happening, though. In some cases, for some types of problems, it is even better to set yourself up to maximize your learning. Your problem-solving methodology is test and learn, test and learn, test and learn, and iterate. That is a heuristic in itself, the A/B testing that is used in many parts of the world. So that’s a problem-solving methodology. It’s nothing different. It just uses technology and feedback loops in a fast way. The other one is exploratory data analysis. When you’re dealing with a large-scale problem, and there’s so much data, I can get to the heuristics that Charles was talking about through very clever visualization of data.

You test with your data. You need to set up an environment to do so, but don’t get caught up in neural-network modeling immediately. You’re testing, you’re checking—“Is the data right? Is it sound? Does it make sense?”—before you launch too far.

Simon London: You do hear these ideas—that if you have a big enough data set and enough algorithms, they’re going to find things that you just wouldn’t have spotted, find solutions that maybe you wouldn’t have thought of. Does machine learning sort of revolutionize the problem-solving process? Or are these actually just other tools in the toolbox for structured problem solving?

Charles Conn: It can be revolutionary. There are some areas in which the pattern recognition of large data sets and good algorithms can help us see things that we otherwise couldn’t see. But I do think it’s terribly important we don’t think that this particular technique is a substitute for superb problem solving, starting with good problem definition. Many people use machine learning without understanding algorithms that themselves can have biases built into them. Just as 20 years ago, when we were doing statistical analysis, we knew that we needed good model definition, we still need a good understanding of our algorithms and really good problem definition before we launch off into big data sets and unknown algorithms.

Simon London: Step six. You’ve done your analysis.

Charles Conn: I take six and seven together, and this is the place where young problem solvers often make a mistake. They’ve got their analysis, and they assume that’s the answer, and of course it isn’t the answer. The ability to synthesize the pieces that came out of the analysis and begin to weave those into a story that helps people answer the question “What should I do?” This is back to where we started. If we can’t synthesize, and we can’t tell a story, then our decision maker can’t find the answer to “What should I do?”

Simon London: But, again, these final steps are about motivating people to action, right?

Charles Conn: Yeah.

Simon London: I am slightly torn about the nomenclature of problem solving because it’s on paper, right? Until you motivate people to action, you actually haven’t solved anything.

Charles Conn: I love this question because I think decision-making theory, without a bias to action, is a waste of time. Everything in how I approach this is to help people take action that makes the world better.

Simon London: Hence, these are absolutely critical steps. If you don’t do this well, you’ve just got a bunch of analysis.

Charles Conn: We end up in exactly the same place where we started, which is people speaking across each other, past each other in the public square, rather than actually working together, shoulder to shoulder, to crack these important problems.

Simon London: In the real world, we have a lot of uncertainty—arguably, increasing uncertainty. How do good problem solvers deal with that?

Hugo Sarrazin: At every step of the process. In the problem definition, when you’re defining the context, you need to understand those sources of uncertainty and whether they’re important or not important. It becomes important in the definition of the tree.

You need to think carefully about the branches of the tree that are more certain and less certain as you define them. They don’t have equal weight just because they’ve got equal space on the page. Then, when you’re prioritizing, your prioritization approach may put more emphasis on things that have low probability but huge impact—or, vice versa, may put a lot of priority on things that are very likely and, hopefully, have a reasonable impact. You can introduce that along the way. When you come back to the synthesis, you just need to be nuanced about what you’re understanding, the likelihood.

Often, people lack humility in the way they make their recommendations: “This is the answer.” They’re very precise, and I think we would all be well-served to say, “This is a likely answer under the following sets of conditions” and then make the level of uncertainty clearer, if that is appropriate. It doesn’t mean you’re always in the gray zone; it doesn’t mean you don’t have a point of view. It just means that you can be explicit about the certainty of your answer when you make that recommendation.

Simon London: So it sounds like there is an underlying principle: “Acknowledge and embrace the uncertainty. Don’t pretend that it isn’t there. Be very clear about what the uncertainties are up front, and then build that into every step of the process.”

Hugo Sarrazin: Every step of the process.

Simon London: Yeah. We have just walked through a particular structured methodology for problem solving. But, of course, this is not the only structured methodology for problem solving. One that is also very well-known is design thinking, which comes at things very differently. So, Hugo, I know you have worked with a lot of designers. Just give us a very quick summary. Design thinking—what is it, and how does it relate?

Hugo Sarrazin: It starts with an incredible amount of empathy for the user and uses that to define the problem. It does pause and go out in the wild and spend an enormous amount of time seeing how people interact with objects, seeing the experience they’re getting, seeing the pain points or joy—and uses that to infer and define the problem.

Simon London: Problem definition, but out in the world.

Hugo Sarrazin: With an enormous amount of empathy. There’s a huge emphasis on empathy. Traditional, more classic problem solving is you define the problem based on an understanding of the situation. This one almost presupposes that we don’t know the problem until we go see it. The second thing is you need to come up with multiple scenarios or answers or ideas or concepts, and there’s a lot of divergent thinking initially. That’s slightly different, versus the prioritization, but not for long. Eventually, you need to kind of say, “OK, I’m going to converge again.” Then you go and you bring things back to the customer and get feedback and iterate. Then you rinse and repeat, rinse and repeat. There’s a lot of tactile building, along the way, of prototypes and things like that. It’s very iterative.

Simon London: So, Charles, are these complements or are these alternatives?

Charles Conn: I think they’re entirely complementary, and I think Hugo’s description is perfect. When we do problem definition well in classic problem solving, we are demonstrating the kind of empathy, at the very beginning of our problem, that design thinking asks us to approach. When we ideate—and that’s very similar to the disaggregation, prioritization, and work-planning steps—we do precisely the same thing, and often we use contrasting teams, so that we do have divergent thinking. The best teams allow divergent thinking to bump them off whatever their initial biases in problem solving are. For me, design thinking gives us a constant reminder of creativity, empathy, and the tactile nature of problem solving, but it’s absolutely complementary, not alternative.

Simon London: I think, in a world of cross-functional teams, an interesting question is do people with design-thinking backgrounds really work well together with classical problem solvers? How do you make that chemistry happen?

Hugo Sarrazin: Yeah, it is not easy when people have spent an enormous amount of time seeped in design thinking or user-centric design, whichever word you want to use. If the person who’s applying classic problem-solving methodology is very rigid and mechanical in the way they’re doing it, there could be an enormous amount of tension. If there’s not clarity in the role and not clarity in the process, I think having the two together can be, sometimes, problematic.

The second thing that happens often is that the artifacts the two methodologies try to gravitate toward can be different. Classic problem solving often gravitates toward a model; design thinking migrates toward a prototype. Rather than writing a big deck with all my supporting evidence, they’ll bring an example, a thing, and that feels different. Then you spend your time differently to achieve those two end products, so that’s another source of friction.

Now, I still think it can be an incredibly powerful thing to have the two—if there are the right people with the right mind-set, if there is a team that is explicit about the roles, if we’re clear about the kind of outcomes we are attempting to bring forward. There’s an enormous amount of collaborativeness and respect.

Simon London: But they have to respect each other’s methodology and be prepared to flex, maybe, a little bit, in how this process is going to work.

Hugo Sarrazin: Absolutely.

Simon London: The other area where, it strikes me, there could be a little bit of a different sort of friction is this whole concept of the day-one answer, which is what we were just talking about in classical problem solving. Now, you know that this is probably not going to be your final answer, but that’s how you begin to structure the problem. Whereas I would imagine your design thinkers—no, they’re going off to do their ethnographic research and get out into the field, potentially for a long time, before they come back with at least an initial hypothesis.

Want better strategies? Become a bulletproof problem solver

Want better strategies? Become a bulletproof problem solver

Hugo Sarrazin: That is a great callout, and that’s another difference. Designers typically will like to soak into the situation and avoid converging too quickly. There’s optionality and exploring different options. There’s a strong belief that keeps the solution space wide enough that you can come up with more radical ideas. If there’s a large design team or many designers on the team, and you come on Friday and say, “What’s our week-one answer?” they’re going to struggle. They’re not going to be comfortable, naturally, to give that answer. It doesn’t mean they don’t have an answer; it’s just not where they are in their thinking process.

Simon London: I think we are, sadly, out of time for today. But Charles and Hugo, thank you so much.

Charles Conn: It was a pleasure to be here, Simon.

Hugo Sarrazin: It was a pleasure. Thank you.

Simon London: And thanks, as always, to you, our listeners, for tuning into this episode of the McKinsey Podcast . If you want to learn more about problem solving, you can find the book, Bulletproof Problem Solving: The One Skill That Changes Everything , online or order it through your local bookstore. To learn more about McKinsey, you can of course find us at

Charles Conn is CEO of Oxford Sciences Innovation and an alumnus of McKinsey’s Sydney office. Hugo Sarrazin is a senior partner in the Silicon Valley office, where Simon London, a member of McKinsey Publishing, is also based.

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The Right Way to Solve Complex Business Problems

Corey Phelps, a strategy professor at McGill University, says great problem solvers are hard to find. Even seasoned professionals at the highest levels of organizations regularly...

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Corey Phelps, a strategy professor at McGill University, says great problem solvers are hard to find. Even seasoned professionals at the highest levels of organizations regularly fail to identify the real problem and instead jump to exploring solutions. Phelps identifies the common traps and outlines a research-proven method to solve problems effectively. He’s the coauthor of the book, Cracked it! How to solve big problems and sell solutions like top strategy consultants.

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Welcome to the IdeaCast from Harvard Business Review. I’m Curt Nickisch.

Problem-solving is in demand. It’s considered the top skill for success at management consulting firms. And it’s increasingly desired for everyone, not just new MBA’s.

A report from the World Economic Forum predicts that more than one-third of all jobs across all industries will require complex problem-solving as one of their core skills by 2020.

The problem is, we’re often really bad at problem-solving. Our guest today says even the most educated and experienced of senior leaders go about it the wrong way.

COREY PHELPS: I think this is one of the misnomers about problem-solving. There’s this belief that because we do it so frequently – and especially for senior leaders, they have a lot of experience, they solve problems for a living – and as such we would expect them to be quite good at it. And I think what we find is that they’re not. They don’t solve problems well because they fall prey to basically the foibles of being a human being – they fall prey to the cognitive biases and the pitfalls of problem-solving.

CURT NICKISCH: That’s Corey Phelps. He says fixing these foibles is possible and almost straightforward. You can improve your problem-solving skills by following a disciplined method.

Corey Phelps is a strategy professor at McGill University. He’s also the co-author of the book “Cracked It: How to Solve Big Problems and Sell Solutions like Top Strategy C onsultants.” Corey thanks for coming on the show.

COREY PHELPS: Thank you for the opportunity to talk.

CURT NICKISCH: Another probably many, many biases that prevent people from solving big problems well.

COREY PHELPS: Absolutely.

CURT NICKISCH: What are some of the most common, or your favorite stumbling blocks?

COREY PHELPS: Well, one of my favorites is essentially the problem of jumping to solutions or the challenge of jumping to solutions.

CURT NICKISCH: Oh, come on Corey. That’s so much fun.

COREY PHELPS: It is, and it’s very much a result of how our brains have evolved to process information, but it’s my favorite because we all do it. And especially I would say it happens in organizations because in organizations when you layer on these time pressures and you layer on these concerns about efficiency and productivity, it creates enormous, I would say incentive to say “I don’t have time to carefully define and analyze the problem. I got to get a solution. I got to implement it as quick as possible.” And the fundamental bias I think is, is illustrated beautifully by Danny Kahneman in his book “Thinking, Fast and Slow,” is that our minds are essentially hardwired to think fast.

We are able to pay attention to a tiny little bit of information. We can then weave a very coherent story that makes sense to us. And then we can use that story to jump very quickly to a solution that we just know will work. And if we just were able to move from that approach of what Kahneman and cognitive psychologists called “System 1 thinking” to “System 2 thinking” – that is to slow down, be more deliberative, be more structured – we would be able to better understand the problem that we’re trying to solve and be more effective and exhaustive with the tools that we want to use to understand the problem before we actually go into solution-generation mode.

CURT NICKISCH: Complex problems demand different areas of expertise and often as individuals we’re coming to those problems with one of them. And I wonder if that’s often the problem of problem-solving, which is that a manager is approaching it from their own expertise and because of that, they see the problem through a certain way. Is that one of the cognitive biases that stop people from being effective problem solvers?

COREY PHELPS: Yeah. That’s often referred to as the expertise trap. It basically colors and influences what we pay attention to with respect to a particular problem. And it limits us with respect to the tools that we can bring to bear to solve that problem. In the world of psychology, there’s famous psychologist, Abraham Maslow, who is famous for the hierarchy of needs. He’s also famous for something that was a also known as MaSlow’s axiom, Maslow’s law. It’s also called the law of the instrument, and to paraphrase Maslow, he basically said, “Look, I suppose if the only tool that you have in your toolkit is a hammer, everything looks like a nail.”

His point is that if you’re, for example, a finance expert and your toolkit is the toolkit of let’s say, discounted cash flow analysis for valuation, then you’re going to see problems through that very narrow lens. Now, one of the ways out of this, I think to your point is collaboration becomes fundamentally important. And collaboration starts with the recognition that I don’t have all of the tools, all of the knowledge in me to effectively solve this. So I need to recruit people that can actually help me.

CURT NICKISCH: That’s really interesting. I wonder how much the fact that you have solved a problem before it makes you have a bias for that same solution for future problems?

COREY PHELPS: Yeah, that’s a great question. What you’re alluding to is analogical reasoning, and we know that human beings, one of the things that allows us to operate in novel settings is that we can draw on our past experience. And we do so when it comes to problem solving, often times without being conscious or mentally aware of it. We reach into our memory and we ask ourselves a very simple question: “Have I seen a problem like this before?”

And if it looks familiar to me, the tendency then is to say, “Okay, well what worked in solving that problem that I faced before?” And then to say, “Well, if it worked in that setting, then it should work in this setting.” So that’s reasoning by analogy.

Reasoning by analogy has a great upside. It allows human beings to not become overwhelmed by the tremendous novelty that they face in their daily lives. The downside is that if we don’t truly understand it at sort of a deep level, whether or not the two problems are similar or different, then we can make what cognitive psychologists called surface-level analogies.

And we can then say, “Oh, this looks a lot like the problem I faced before, that solution that worked there is going to easily work here.” And we try that solution and it fails and it fails largely because if we dug a little bit deeper, the two problems actually aren’t much alike at all in terms of their underlying causes.

CURT NICKISCH: The starkest example of this, I think, in your book is Ron Johnson who left Apple to become CEO of JC Penney. Can you talk about that a little bit and what that episode for the company says about this?

COREY PHELPS: So yes, its – Ron Johnson had been hired away from Target in the United States to, by Steve Jobs to help create Apple stores. Apple stores are as many people know the most successful physical retailer on the planet measured by, for example, sales per square foot or per square meter. He’s got the golden touch. He’s created this tremendously successful retail format for Apple.

So the day that it was announced that Ron Johnson was going to step into the CEO role at JC Penney, the stock price of JC Penney went up by almost 18 percent. So clearly he was viewed as the savior. Johnson moves very, very quickly. Within a few months, he announces that he has a strategic plan and it basically comes in three parts.

Part number one is he’s going to eliminate discount pricing. JC Penney had been a very aggressive sales promoter. The second piece of it is he’s going to completely change how they organize merchandise. It’s no longer going to be organized by function – so menswear, housewares, those sorts of things. It’s going to be organized by boutique, so there’s going to be a Levi’s boutique, a Martha Stewart Boutique, a Joe Fresh Boutique and so on.

And it would drop the JC P enney name, they would call it JCP. And he rolls this out over the course of about 12 months across the entire chain of over 1100 stores. What this tells us, he’s so confident in his solution, his strategic transformation, that he doesn’t think it’s worth it to test this out on one or two pilot stores.

CURT NICKISCH: Yeah, he was quoted as saying: “At Apple, we didn’t test anything.”

COREY PHELPS: We didn’t test. Yes. What worked at Apple, he assumed would work at JC Penney. And the critical thing that I think he missed is that JC Penney customers are very different from Apple store customers. In fact, JC Penney customers love the discount. They love the thrill of hunting for a deal.

CURT NICKISCH: Which seems so fundamental to business, right? Understanding your customer. It’s just kind of shocking, I guess, to hear the story.

COREY PHELPS: It is shocking and especially when you consider that Ron Johnson had spent his entire career in retail, so this is someone that had faced, had seen, problems in retailers for decades – for over three decades by the time that he got to JC Penney. So you would expect someone with that degree of experience in that industry wouldn’t make that leap of, well, what worked at Apple stores is going to work at JC Penney stores, but in fact that’s exactly what happened.

CURT NICKISCH: In your book, you essentially suggest four steps that you recommend people use. Tell us about the four steps then.

COREY PHELPS: So in the book we describe what we call the “Four S method,” so four stages, each of which starts with the letter “s”. So the first stage is “state the problem.” Stating the problem is fundamentally about defining what the problem is that you are attempting to solve.

CURT NICKISCH: And you probably would say don’t hurry over that first step or the other three are going to be kind of pointless.

COREY PHELPS: Yeah, that’s exactly the point of of laying out the four s’s. There’s a tremendous amount of desire even amongst senior executives to want to get in and fix the problem. In other words, what’s the trouble? What are the symptoms? What would define success? What are the constraints that we would be operating under? Who owns the problem? And then who are the key stakeholders?

Oftentimes that step is skipped over and we go right into, “I’ve got a hypothesis about what I think the solution is and I’m so obsessed with getting this thing fixed quickly, I’m not going to bother to analyze it particularly well or test the validity of my assumptions. I’m going to go right into implementation mode.”

The second step, what we call “structure the problem” is once you have defined the problem, you need to then start to identify what are the potential causes of that problem. So there are different tools that we talked about in the book that you can structure a problem for analysis. Once you’ve structured the problem for analysis and you’ve conducted the analysis that helps you identify what are the underlying causes that are contributing to it, which will then inform the third stage which is generating solutions for the problem and then testing and evaluating those solutions.

CURT NICKISCH: Is the danger that that third step – generating solutions – is the step that people spend the most time on or have the most fun with?

COREY PHELPS: Yeah. The danger is, is that what that’s naturally what people gravitate towards. So we want to skip over the first two, state and structure.

CURT NICKISCH: As soon as you said it, I was like, “let’s talk about that more.”

COREY PHELPS: Yeah. And we want to jump right into solutioning because people love to talk about their ideas that are going to fix the problem. And that’s actually a useful way to frame a discussion about solutions – we could, or we might do this – because it opens up possibilities for experimentation.

And the problem is that when we often talk about what we could do, we have very little understanding of what the problem is that we’re trying to solve and what are the underlying causes of that problem. Because as you said, solution generation is fun. Look, the classic example is brainstorming. Let’s get a bunch of people in a room and let’s talk about the ideas on how to fix this thing. And again, be deliberate, be disciplined. Do those first stages, the first two stages – state and structure – before you get into the solution generation phase.

CURT NICKISCH: Yeah. The other thing that often happens there is just the lack of awareness of just the cost of the different solutions – how much time, or what they would actually take to do.

COREY PHELPS: Yeah, and again, I’ll go back to that example I used of brainstorming where it’s fun to get a group of people together and talk about our ideas and how to fix the problem. There’s a couple challenges of that. One is what often happens when we do that is we tend to censor the solutions that we come up with. In other words, we ask ourselves, “if I say this idea, people are gonna, think I’m crazy, or people going to say: that’s stupid, that’ll never work, we can’t do that in our organization. It’s going to be too expensive, it’s going to take too much time. We don’t have the resources to do it.”

So brainstorming downside is we we self-sensor, so that’s where you need to have deep insight into your organization in terms of A. what’s going to be feasible, B. what’s going to be desirable on the part of the people that actually have the problem, who you’re trying to solve the problem for and C. from a business standpoint, is it going to be financially attractive for us?

So applying again a set of disciplined criteria that help you choose amongst those ideas for potential solutions. Then the last stage of the process which is selling – because it’s rare in any organization that someone or the group of people that come up with the solution actually have the power and the resources to implement it, so that means they’re going to have to persuade other people to buy into it and want to help.

CURT NICKISCH: Design thinking is another really different method essentially for solving problems or coming up with solutions that just aren’t arrived at through usual problem-solving or usual decision-making processes. I’m just wondering how design thinking comes to play when you’re also outlining these, you know, disciplined methods for stating and solving problems.

COREY PHELPS: For us it’s about choosing the right approach. You know what the potential causes of a problem are. You just don’t know which ones are operating in the particular problem you’re trying to solve. And what that means is that you’ve got a theory – and this is largely the world of strategy consultants – strategy consultants have theories. They have, if you hear them speak, deep understanding of different types of organizational problems, and what they bring is an analytic tool kit that says, “first we’re going to identify all the possible problems, all the possible causes I should say, of this problem. We’re going to figure out which ones are operating and we’re going to use that to come up with a solution.” Then you’ve got problems that you have no idea what the causes are. You’re in a world of unknown unknowns or unk-unks as the operations management people call them.

CURT NICKISCH: That’s terrible.

COREY PHELPS: In other words, you don’t have a theory. So the question is, how do you begin? Well, this is where design thinking can be quite valuable. Design thinking says: first off, let’s find out who are the human beings, the people that are actually experiencing this problem, and let’s go out and let’s talk to them. Let’s observe them. Let’s immerse ourselves in their experience and let’s start to develop an understanding of the causes of the problem from their perspective.

So rather than go into it and say, “I have a theory,” let’s go the design thinking route and let’s actually based upon interactions with users or customers, let’s actually develop a theory. And then we’ll use our new understanding or new insight into the causes of the problem to move into the solution generation phase.

CURT NICKISCH: Problem-solving – we know that that’s something that employers look for when they’re recruiting people. It is one of those phrases that, you know, I’m sure somebody out there has, has the title at a company Chief Problem Solver instead of CEO, right? So, it’s almost one of those phrases that so over used it can lose its meaning.

And if you are being hired or you’re trying to make a case for being on a team that’s tackling a problem, how do you make a compelling case that you are a good problem solver? How can you actually show it?

COREY PHELPS: It’s a great question and then I have two answers to this question. So one is, look at the end of the day, the proof is in the pudding. In other words, can you point to successful solutions that you’ve come up with – solutions that have actually been effective in solving a problem? So that’s one.

The second thing is can you actually articulate how you approach problem-solving? In other words, do you follow a method or are you reinventing the wheel every time you solve a problem? Is it an ad hoc approach? And I think this issue really comes to a head when it comes to the world of strategy consulting firms when they recruit. For example, Mckinsey, you’ve got the Mckinsey problem-solving test, which is again, a test that’s actually trying to elicit the extent to which people are good applicants are good at solving problems

And then you’ve got the case interview. And in the case interview, what they’re looking at is do you have a mastery over certain tools. But what they’re really looking at is, are you actually following a logical process to solve this problem? Because again, what they’re interested in is finding- to your point – people that are going to be good at solving complex organizational problems. So they’re trying to get some evidence that they can demonstrate that they’re good at it and some evidence that they follow a deliberate process.

CURT NICKISCH: So even if you’re not interviewing at a consulting firm, that’s a good approach, to show your thinking, show your process, show the questions you ask?

COREY PHELPS: Yeah, and to your point earlier, at least if we look at what recruiters of MBA students are saying these days, they’re saying, for example, according to the FT’s recent survey, they’re saying that we want people with really good problem solving skills, and by the same token, we find that that’s a skill that’s difficult for us to recruit for. And that reinforces our interest in this area because the fundamental idea for the book is to give people a method. We’re trying to equip not just MBA students but everybody that’s going to face complex problems with a toolkit to solve them better.

CURT NICKISCH: Corey, this has been really great. Thank you.

COREY PHELPS: Thanks for the opportunity. I appreciate it.

CURT NICKISCH: That’s Corey Phelps. He teaches strategy at McGill University, and he co-wrote the book “Cracked It: How to Solve Big Problems and Sell Solutions Like Top Strategy Consultants.”

This episode was produced by Mary Dooe. We got technical help from Rob Eckhardt. Adam Buchholz is our audio product manager.

Thanks for listening to the HBR IdeaCast. I’m Curt Nickisch.

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This article is about decision making and problem solving, partner center.

Purdue University

Effective Problem-Solving Techniques in Business

A business team discusses a problem in a conference room

January 20, 2023

Purdue Online

Problem solving is an increasingly important soft skill for those in business. The Future of Jobs Survey by the World Economic Forum drives this point home. According to this report, complex problem solving is identified as one of the top 15 skills that will be sought by employers in 2025, along with other soft skills such as analytical thinking, creativity and leadership.

Dr. Amy David , clinical associate professor of management for supply chain and operations management, spoke about business problem-solving methods and how the Purdue University Online MBA program prepares students to be business decision-makers.

Why Are Problem-Solving Skills Essential in Leadership Roles?

Every business will face challenges at some point. Those that are successful will have people in place who can identify and solve problems before the damage is done.

“The business world is constantly changing, and companies need to be able to adapt well in order to produce good results and meet the needs of their customers,” David says. “They also need to keep in mind the triple bottom line of ‘people, profit and planet.’ And these priorities are constantly evolving.”

To that end, David says people in management or leadership need to be able to handle new situations, something that may be outside the scope of their everyday work.

“The name of the game these days is change—and the speed of change—and that means solving new problems on a daily basis,” she says.

The pace of information and technology has also empowered the customer in a new way that provides challenges—or opportunities—for businesses to respond.

“Our customers have a lot more information and a lot more power,” she says. “If you think about somebody having an unhappy experience and tweeting about it, that’s very different from maybe 15 years ago. Back then, if you had a bad experience with a product, you might grumble about it to one or two people.”

David says that this reality changes how quickly organizations need to react and respond to their customers. And taking prompt and decisive action requires solid problem-solving skills.

What Are Some of the Most Effective Problem-Solving Methods?

David says there are a few things to consider when encountering a challenge in business.

“When faced with a problem, are we talking about something that is broad and affects a lot of people? Or is it something that affects a select few? Depending on the issue and situation, you’ll need to use different types of problem-solving strategies,” she says.

Using Techniques

There are a number of techniques that businesses use to problem solve. These can include:

  • Five Whys : This approach is helpful when the problem at hand is clear but the underlying causes are less so. By asking “Why?” five times, the final answer should get at the potential root of the problem and perhaps yield a solution.
  • Gap Analysis : Companies use gap analyses to compare current performance with expected or desired performance, which will help a company determine how to use its resources differently or adjust expectations.
  • Gemba Walk : The name, which is derived from a Japanese word meaning “the real place,” refers to a commonly used technique that allows managers to see what works (and what doesn’t) from the ground up. This is an opportunity for managers to focus on the fundamental elements of the process, identify where the value stream is and determine areas that could use improvement.
  • Porter’s Five Forces : Developed by Harvard Business School professor Michael E. Porter, applying the Five Forces is a way for companies to identify competitors for their business or services, and determine how the organization can adjust to stay ahead of the game.
  • Six Thinking Hats : In his book of the same name, Dr. Edward de Bono details this method that encourages parallel thinking and attempting to solve a problem by trying on different “thinking hats.” Each color hat signifies a different approach that can be utilized in the problem-solving process, ranging from logic to feelings to creativity and beyond. This method allows organizations to view problems from different angles and perspectives.
  • SWOT Analysis : This common strategic planning and management tool helps businesses identify strengths, weaknesses, opportunities and threats (SWOT).

“We have a lot of these different tools,” David says. “Which one to use when is going to be dependent on the problem itself, the level of the stakeholders, the number of different stakeholder groups and so on.”

Each of the techniques outlined above uses the same core steps of problem solving:

  • Identify and define the problem
  • Consider possible solutions
  • Evaluate options
  • Choose the best solution
  • Implement the solution
  • Evaluate the outcome

Data drives a lot of daily decisions in business and beyond. Analytics have also been deployed to problem solve.

“We have specific classes around storytelling with data and how you convince your audience to understand what the data is,” David says. “Your audience has to trust the data, and only then can you use it for real decision-making.”

Data can be a powerful tool for identifying larger trends and making informed decisions when it’s clearly understood and communicated. It’s also vital for performance monitoring and optimization.

How Is Problem Solving Prioritized in Purdue’s Online MBA?

The courses in the Purdue Online MBA program teach problem-solving methods to students, keeping them up to date with the latest techniques and allowing them to apply their knowledge to business-related scenarios.

“I can give you a model or a tool, but most of the time, a real-world situation is going to be a lot messier and more valuable than what we’ve seen in a textbook,” David says. “Asking students to take what they know and apply it to a case where there’s not one single correct answer is a big part of the learning experience.”

Make Your Own Decision to Further Your Career

An online MBA from Purdue University can help advance your career by teaching you problem-solving skills, decision-making strategies and more. Reach out today to learn more about earning an online MBA with Purdue University .

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What Is Problem Solving in Business?

Problem-solving in business is defined as implementing processes that reduce or remove obstacles that are preventing you or others from accomplishing operational and strategic business goals.

In business, a problem is a situation that creates a gap between the desired and actual outcomes. In addition, a true problem typically does not have an immediately obvious resolution.

Business problem-solving works best when it is approached through a consistent system in which individuals:

  • Identify and define the problem
  • Prioritize the problem based on size, potential impact, and urgency
  • Complete a root-cause analysis
  • Develop a variety of possible solutions
  • Evaluate possible solutions and decide which is most effective
  • Plan and implement the solution

Why Problem Solving Is Important in Business

Understanding the importance of problem-solving skills in the workplace will help you develop as a leader. Problem-solving skills will help you resolve critical issues and conflicts that you come across. Problem-solving is a valued skill in the workplace because it allows you to:

  • Apply a standard problem-solving system to all challenges
  • Find the root causes of problems
  • Quickly deal with short-term business interruptions
  • Form plans to deal with long-term problems and improve the organization
  • See challenges as opportunities
  • Keep your cool during challenges

How to Solve Business Problems Effectively

There are many different problem-solving skills, but most can be broken into general steps. Here is a four-step method for business problem solving:

1) Identify the Details of the Problem: Gather enough information to accurately define the problem. This can include data on procedures being used, employee actions, relevant workplace rules, and so on. Write down the specific outcome that is needed, but don’t assume what the solution should be.

2) Creatively Brainstorm Solutions: Alone or with a team, state every solution you can think of. You’ll often need to write them down. To get more solutions, brainstorm with the employees who have the greatest knowledge of the issue.

3) Evaluate Solutions and Make a Decision: Compare and contrast alternative solutions based on the feasibility of each one, including the resources needed to implement it and the return on investment of each one. Finally, make a firm decision on one solution that clearly addresses the root cause of the problem.

4) Take Action: Write up a detailed plan for implementing the solution, get the necessary approvals, and put it into action.

What Are Problem-Solving Skills?

Problem-solving skills are specific procedures that can be used to complete one or more of the four general steps of problem-solving (discussed above). Here are five important examples:

Using Emotional Intelligence: You’ll solve problems more calmly when you learn to recognize your own emotional patterns and to empathize with and guide the emotions of others. Avoid knee-jerk responses and making assumptions.

Researching Problems: An effective solution requires an accurate description of the problem. Define simple problems using quick research methods such as asking, “What? Where? When? and How much?.” Difficult problems require more in-depth research, such as data exploration, surveys, and interviews.

Creative Brainstorming: When brainstorming with a group, encourage idea creation by listening attentively to everyone, and recognizing everyone’s unique contributions.

Logical Reasoning: Develop standard logical steps for analyzing possible solutions to problems. Study and apply ideas about logical fallacies, deductive reasoning, and other areas of analytical thought.

Decisiveness: Use an agreed-upon system for choosing a solution, which can include assigning pros and cons to solutions, identifying mandatory results, getting feedback about solutions, choosing the decision-maker(s), and finishing or repeating the process.

How to Improve Problem-Solving Skills

Learning how to solve business problems takes time and effort. Though some people appear to have been born with superior problem-solving skills, great problem solvers usually have practiced and refined their abilities. You can develop high-level skills for solving problems too, through the following methods:

Ask and Listen: Don’t expect to solve every problem alone. Ask for advice, and listen to it carefully.

Practice Curiosity: Any time you’re involved in solving a problem, practice researching and defining the problem just a little longer than you would naturally.

Break Down Problems: Whenever possible, break large problems into their smallest units. Then, search for solutions to one unit at a time.

Don’t Label Yourself Negatively: Don’t allow a problem to mean something negative about you personally. Separate yourself from it. Look at it objectively and be part of the solution.

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Home » Business Cycle » Problem solving in business

Business problem solving

We all know someone who always seems to have the answer. They’re prepared for any situation and solve problems quickly and decisively. These people are typically great leaders in business and in life. But is business problem solving a natural talent? Or is it a skill you can develop?  

The truth is that business problem solving is a set of skills and strategies that anyone can learn – and it’s more important than ever.   

With the economy in a winter phase and the nature of work transforming before our eyes, there’s no shortage of business problems to solve in today’s economy. Learning how to solve business problems effectively requires focus, decisiveness and self-awareness.

Discover how to solve business problems effectively

Business problem solving: an essential skill

Whether you’re managing a new company or just starting as CEO at a global enterprise, you’re sure to encounter business problems to solve . Dealing with crises . Employee turnover and unhappiness. Inability to scale mindfully. Financial problems. Leadership gaps. Without creative thinking to solve business problems , these issues can quickly build up and lead to the one thing you certainly don’t want: the close of your business.  

Strong leadership and decision-making have the opposite effect: one study even found that extraordinary leaders can double profits at their companies. Business problem solving is an essential skill not only for owners and CEOs, but anyone with entrepreneurial desires or career-climbing dreams.

How to solve business problems effectively

Business problems to solve are easy to come by – the skills needed to make tough choices and act decisively are less common. But with the right strategies, you can develop them and learn how to take your business to the next level .

1. Know where you want to be

find certainty

Business problem solving always starts with having a plan. If you don’t have goals you’re working toward, you’ll never know when you miss them. The signs of business problems will pass you by.

A traditional business plan isn’t enough, because it only shows you how to get from point A to point B. You need to create a business map – a holistic view of your vision, your mission and all the possible business problems to solve. This map will keep you moving along the route to your ultimate goal: scaling your business and planning an exit strategy .

2. Know where you are

The next step is to get real: be honest about where your business is currently. Look at your financial statements. Survey your employees to get an idea of business problems to solve on the front lines. Ask your colleagues and others in your industry where they are so that you can compare.

It’s important to be realistic at this step. If you have a high risk tolerance , you may be tempted to be overly optimistic. If you’re a perfectionist or have low risk tolerance, you could be more negative than you need to be. Avoid falling in love with your product or your company and make sure you’re taking an objective look at where you are.

Business problems to solve

3. Identify the problem

business problem solving

In much the same way you ask “What business am I in?” and then “What business am I really in?” you can ask, “What’s the problem?” You’ll likely identify a surface-level answer, like “sales are dropping.” Then ask, “What’s really the problem?” Sales are affected by multiple other business problems to solve , from recruiting top salespeople to providing excellent customer service .

Business problem solving often goes back to the customer. You must provide them with more value than anyone else, through your product and your customer experience. If you’re having trouble identifying your business problem, start with these areas. 

4. Understand the problem

It’s tempting to jump right to solutions once you’ve identified the problem. But pulling weeds out by the top is never effective. You need to get to the root of the issue. When was the last time you did a competitive analysis or surveyed your customers for feedback?

It isn’t enough to perform a typical SWOT analysis and leave it at that. Creative thinking to solve business problems starts with listening . When you listen, you’ll receive data – the opinions of customers, the strategies of competitors. That data will tell a story. Only when you uncover this story will you be able to pull the weed out by the root.

sales mindset.

5. Focus on solutions

Tony tells us to “Identify your problems, but give your power and energy to solutions.” Now is the time for solutions – but you can’t do it alone. Get together with your team or your colleagues and brainstorm. Ask the right questions so that you get honest, productive answers. Model various scenarios and rank them based on their outcomes. Apply a framework like the Rapid Planning Method to help you.  

Get a second opinion from your mentor or a group of trusted advisors outside of your company. Sign up for business coaching to run your questions by an expert. Narrow down your options until you’re confident you’ve come to the right solution. Then create a massive action plan and put your business problem-solving skills to use.

Ready to solve your business problems?

Learn how to optimize your entire business strategy and gain an edge over your competition with Tony’s free 7 Forces of Business Mastery program.

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Don't Just Start a Business, Solve A Problem You don't want to start a business that may not survive. Do your homework, validate your idea and make sure you have a real market for it.

By Thomas Oppong • Aug 15, 2014

Opinions expressed by Entrepreneur contributors are their own.

As long as consumers have problems, they will always search for solutions. People will always look for better, faster and smarter ways to accomplish everyday tasks. And fortunately for entrepreneurs, there are still lots of rooms for improvements in existing products. That said, the biggest issue for most founders is finding these painful problems and matching them with the best solutions possible.

Here are a couple pieces of insight to get you started.

Focus on building a must have not a nice to have product. Consumers are overwhelmed with the paradox of choice on daily basis. Attention spans are getting shorter in the age of multi-tasking and only few products are getting noticed – with many being a solution for a must not a want. The demand for quicker and faster results make it difficult to fully satisfy the needs of consumers. You need to be doing something different and better to make it in this world, as donsumers expect and demand more than just another product.

Related: Creative Problem-Solving Strategies to Test Your Business Idea

Solve real painful problems. Google made search better. Amazon simplified online buying and selling. Netflix solved on-demand streaming media. Uber is trying to make on-demand car service better. What can you make smarter or better?

Related: Want to Solve Problems More Efficiently? Do This .

What is the one painful problem you can solve without struggle? To grab your customer's attention, start by solving their needs, wants rarely make the cut. If your product is not a must-have, you could still find a way to repurpose it to solve a pressing need. If you have been able to identify a crucial problem that you can effectively execute and deliver to market, you will be able to create a real business that matters.

Your business should be your passion. Some entrepreneurs look to solve problems they identify with or feel passionate. They choose this path because work because less about work and more about enjoying the journey.

You will need all the inspiration, commitment and the perseverance you can get to make it as an entrepreneur, hence the need to start a business you are passionate about.

"The happiest and most successful people I know don't just love what they do, they're obsessed with solving an important problem, something that matters to them," Dropbox co-founder Drew Houston said during the 2013 MIT commencement address.

Coupled with passion, is the ability to execute. If you can't deliver, you are not in business. Products with a real need are easy to market and you won't have to convince people about the existence of the problem and the need for your product because they identify with it.

You don't want to start a business that may not survive. Do your homework, validate your idea and make sure you have a real market for your idea. Don't just start another business, solve a real problem people actually have to increase your chances of success.

Related: Richard Branson on Finding Your Passion Project

Founder @Alltopstartups

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35 problem-solving techniques and methods for solving complex problems

Problem solving workshop

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All teams and organizations encounter challenges as they grow. There are problems that might occur for teams when it comes to miscommunication or resolving business-critical issues . You may face challenges around growth , design , user engagement, and even team culture and happiness. In short, problem-solving techniques should be part of every team’s skillset.

Problem-solving methods are primarily designed to help a group or team through a process of first identifying problems and challenges , ideating possible solutions , and then evaluating the most suitable .

Finding effective solutions to complex problems isn’t easy, but by using the right process and techniques, you can help your team be more efficient in the process.

So how do you develop strategies that are engaging, and empower your team to solve problems effectively?

In this blog post, we share a series of problem-solving tools you can use in your next workshop or team meeting. You’ll also find some tips for facilitating the process and how to enable others to solve complex problems.

Let’s get started! 

How do you identify problems?

How do you identify the right solution.

  • Tips for more effective problem-solving

Complete problem-solving methods

  • Problem-solving techniques to identify and analyze problems
  • Problem-solving techniques for developing solutions

Problem-solving warm-up activities

Closing activities for a problem-solving process.

Before you can move towards finding the right solution for a given problem, you first need to identify and define the problem you wish to solve. 

Here, you want to clearly articulate what the problem is and allow your group to do the same. Remember that everyone in a group is likely to have differing perspectives and alignment is necessary in order to help the group move forward. 

Identifying a problem accurately also requires that all members of a group are able to contribute their views in an open and safe manner. It can be scary for people to stand up and contribute, especially if the problems or challenges are emotive or personal in nature. Be sure to try and create a psychologically safe space for these kinds of discussions.

Remember that problem analysis and further discussion are also important. Not taking the time to fully analyze and discuss a challenge can result in the development of solutions that are not fit for purpose or do not address the underlying issue.

Successfully identifying and then analyzing a problem means facilitating a group through activities designed to help them clearly and honestly articulate their thoughts and produce usable insight.

With this data, you might then produce a problem statement that clearly describes the problem you wish to be addressed and also state the goal of any process you undertake to tackle this issue.  

Finding solutions is the end goal of any process. Complex organizational challenges can only be solved with an appropriate solution but discovering them requires using the right problem-solving tool.

After you’ve explored a problem and discussed ideas, you need to help a team discuss and choose the right solution. Consensus tools and methods such as those below help a group explore possible solutions before then voting for the best. They’re a great way to tap into the collective intelligence of the group for great results!

Remember that the process is often iterative. Great problem solvers often roadtest a viable solution in a measured way to see what works too. While you might not get the right solution on your first try, the methods below help teams land on the most likely to succeed solution while also holding space for improvement.

Every effective problem solving process begins with an agenda . A well-structured workshop is one of the best methods for successfully guiding a group from exploring a problem to implementing a solution.

In SessionLab, it’s easy to go from an idea to a complete agenda . Start by dragging and dropping your core problem solving activities into place . Add timings, breaks and necessary materials before sharing your agenda with your colleagues.

The resulting agenda will be your guide to an effective and productive problem solving session that will also help you stay organized on the day!

business to business problem solving

Tips for more effective problem solving

Problem-solving activities are only one part of the puzzle. While a great method can help unlock your team’s ability to solve problems, without a thoughtful approach and strong facilitation the solutions may not be fit for purpose.

Let’s take a look at some problem-solving tips you can apply to any process to help it be a success!

Clearly define the problem

Jumping straight to solutions can be tempting, though without first clearly articulating a problem, the solution might not be the right one. Many of the problem-solving activities below include sections where the problem is explored and clearly defined before moving on.

This is a vital part of the problem-solving process and taking the time to fully define an issue can save time and effort later. A clear definition helps identify irrelevant information and it also ensures that your team sets off on the right track.

Don’t jump to conclusions

It’s easy for groups to exhibit cognitive bias or have preconceived ideas about both problems and potential solutions. Be sure to back up any problem statements or potential solutions with facts, research, and adequate forethought.

The best techniques ask participants to be methodical and challenge preconceived notions. Make sure you give the group enough time and space to collect relevant information and consider the problem in a new way. By approaching the process with a clear, rational mindset, you’ll often find that better solutions are more forthcoming.  

Try different approaches  

Problems come in all shapes and sizes and so too should the methods you use to solve them. If you find that one approach isn’t yielding results and your team isn’t finding different solutions, try mixing it up. You’ll be surprised at how using a new creative activity can unblock your team and generate great solutions.

Don’t take it personally 

Depending on the nature of your team or organizational problems, it’s easy for conversations to get heated. While it’s good for participants to be engaged in the discussions, ensure that emotions don’t run too high and that blame isn’t thrown around while finding solutions.

You’re all in it together, and even if your team or area is seeing problems, that isn’t necessarily a disparagement of you personally. Using facilitation skills to manage group dynamics is one effective method of helping conversations be more constructive.

Get the right people in the room

Your problem-solving method is often only as effective as the group using it. Getting the right people on the job and managing the number of people present is important too!

If the group is too small, you may not get enough different perspectives to effectively solve a problem. If the group is too large, you can go round and round during the ideation stages.

Creating the right group makeup is also important in ensuring you have the necessary expertise and skillset to both identify and follow up on potential solutions. Carefully consider who to include at each stage to help ensure your problem-solving method is followed and positioned for success.

Document everything

The best solutions can take refinement, iteration, and reflection to come out. Get into a habit of documenting your process in order to keep all the learnings from the session and to allow ideas to mature and develop. Many of the methods below involve the creation of documents or shared resources. Be sure to keep and share these so everyone can benefit from the work done!

Bring a facilitator 

Facilitation is all about making group processes easier. With a subject as potentially emotive and important as problem-solving, having an impartial third party in the form of a facilitator can make all the difference in finding great solutions and keeping the process moving. Consider bringing a facilitator to your problem-solving session to get better results and generate meaningful solutions!

Develop your problem-solving skills

It takes time and practice to be an effective problem solver. While some roles or participants might more naturally gravitate towards problem-solving, it can take development and planning to help everyone create better solutions.

You might develop a training program, run a problem-solving workshop or simply ask your team to practice using the techniques below. Check out our post on problem-solving skills to see how you and your group can develop the right mental process and be more resilient to issues too!

Design a great agenda

Workshops are a great format for solving problems. With the right approach, you can focus a group and help them find the solutions to their own problems. But designing a process can be time-consuming and finding the right activities can be difficult.

Check out our workshop planning guide to level-up your agenda design and start running more effective workshops. Need inspiration? Check out templates designed by expert facilitators to help you kickstart your process!

In this section, we’ll look at in-depth problem-solving methods that provide a complete end-to-end process for developing effective solutions. These will help guide your team from the discovery and definition of a problem through to delivering the right solution.

If you’re looking for an all-encompassing method or problem-solving model, these processes are a great place to start. They’ll ask your team to challenge preconceived ideas and adopt a mindset for solving problems more effectively.

  • Six Thinking Hats
  • Lightning Decision Jam
  • Problem Definition Process
  • Discovery & Action Dialogue
Design Sprint 2.0
  • Open Space Technology

1. Six Thinking Hats

Individual approaches to solving a problem can be very different based on what team or role an individual holds. It can be easy for existing biases or perspectives to find their way into the mix, or for internal politics to direct a conversation.

Six Thinking Hats is a classic method for identifying the problems that need to be solved and enables your team to consider them from different angles, whether that is by focusing on facts and data, creative solutions, or by considering why a particular solution might not work.

Like all problem-solving frameworks, Six Thinking Hats is effective at helping teams remove roadblocks from a conversation or discussion and come to terms with all the aspects necessary to solve complex problems.

2. Lightning Decision Jam

Featured courtesy of Jonathan Courtney of AJ&Smart Berlin, Lightning Decision Jam is one of those strategies that should be in every facilitation toolbox. Exploring problems and finding solutions is often creative in nature, though as with any creative process, there is the potential to lose focus and get lost.

Unstructured discussions might get you there in the end, but it’s much more effective to use a method that creates a clear process and team focus.

In Lightning Decision Jam, participants are invited to begin by writing challenges, concerns, or mistakes on post-its without discussing them before then being invited by the moderator to present them to the group.

From there, the team vote on which problems to solve and are guided through steps that will allow them to reframe those problems, create solutions and then decide what to execute on. 

By deciding the problems that need to be solved as a team before moving on, this group process is great for ensuring the whole team is aligned and can take ownership over the next stages. 

Lightning Decision Jam (LDJ)   #action   #decision making   #problem solving   #issue analysis   #innovation   #design   #remote-friendly   The problem with anything that requires creative thinking is that it’s easy to get lost—lose focus and fall into the trap of having useless, open-ended, unstructured discussions. Here’s the most effective solution I’ve found: Replace all open, unstructured discussion with a clear process. What to use this exercise for: Anything which requires a group of people to make decisions, solve problems or discuss challenges. It’s always good to frame an LDJ session with a broad topic, here are some examples: The conversion flow of our checkout Our internal design process How we organise events Keeping up with our competition Improving sales flow

3. Problem Definition Process

While problems can be complex, the problem-solving methods you use to identify and solve those problems can often be simple in design. 

By taking the time to truly identify and define a problem before asking the group to reframe the challenge as an opportunity, this method is a great way to enable change.

Begin by identifying a focus question and exploring the ways in which it manifests before splitting into five teams who will each consider the problem using a different method: escape, reversal, exaggeration, distortion or wishful. Teams develop a problem objective and create ideas in line with their method before then feeding them back to the group.

This method is great for enabling in-depth discussions while also creating space for finding creative solutions too!

Problem Definition   #problem solving   #idea generation   #creativity   #online   #remote-friendly   A problem solving technique to define a problem, challenge or opportunity and to generate ideas.

4. The 5 Whys 

Sometimes, a group needs to go further with their strategies and analyze the root cause at the heart of organizational issues. An RCA or root cause analysis is the process of identifying what is at the heart of business problems or recurring challenges. 

The 5 Whys is a simple and effective method of helping a group go find the root cause of any problem or challenge and conduct analysis that will deliver results. 

By beginning with the creation of a problem statement and going through five stages to refine it, The 5 Whys provides everything you need to truly discover the cause of an issue.

The 5 Whys   #hyperisland   #innovation   This simple and powerful method is useful for getting to the core of a problem or challenge. As the title suggests, the group defines a problems, then asks the question “why” five times, often using the resulting explanation as a starting point for creative problem solving.

5. World Cafe

World Cafe is a simple but powerful facilitation technique to help bigger groups to focus their energy and attention on solving complex problems.

World Cafe enables this approach by creating a relaxed atmosphere where participants are able to self-organize and explore topics relevant and important to them which are themed around a central problem-solving purpose. Create the right atmosphere by modeling your space after a cafe and after guiding the group through the method, let them take the lead!

Making problem-solving a part of your organization’s culture in the long term can be a difficult undertaking. More approachable formats like World Cafe can be especially effective in bringing people unfamiliar with workshops into the fold. 

World Cafe   #hyperisland   #innovation   #issue analysis   World Café is a simple yet powerful method, originated by Juanita Brown, for enabling meaningful conversations driven completely by participants and the topics that are relevant and important to them. Facilitators create a cafe-style space and provide simple guidelines. Participants then self-organize and explore a set of relevant topics or questions for conversation.

6. Discovery & Action Dialogue (DAD)

One of the best approaches is to create a safe space for a group to share and discover practices and behaviors that can help them find their own solutions.

With DAD, you can help a group choose which problems they wish to solve and which approaches they will take to do so. It’s great at helping remove resistance to change and can help get buy-in at every level too!

This process of enabling frontline ownership is great in ensuring follow-through and is one of the methods you will want in your toolbox as a facilitator.

Discovery & Action Dialogue (DAD)   #idea generation   #liberating structures   #action   #issue analysis   #remote-friendly   DADs make it easy for a group or community to discover practices and behaviors that enable some individuals (without access to special resources and facing the same constraints) to find better solutions than their peers to common problems. These are called positive deviant (PD) behaviors and practices. DADs make it possible for people in the group, unit, or community to discover by themselves these PD practices. DADs also create favorable conditions for stimulating participants’ creativity in spaces where they can feel safe to invent new and more effective practices. Resistance to change evaporates as participants are unleashed to choose freely which practices they will adopt or try and which problems they will tackle. DADs make it possible to achieve frontline ownership of solutions.

7. Design Sprint 2.0

Want to see how a team can solve big problems and move forward with prototyping and testing solutions in a few days? The Design Sprint 2.0 template from Jake Knapp, author of Sprint, is a complete agenda for a with proven results.

Developing the right agenda can involve difficult but necessary planning. Ensuring all the correct steps are followed can also be stressful or time-consuming depending on your level of experience.

Use this complete 4-day workshop template if you are finding there is no obvious solution to your challenge and want to focus your team around a specific problem that might require a shortcut to launching a minimum viable product or waiting for the organization-wide implementation of a solution.

8. Open space technology

Open space technology- developed by Harrison Owen – creates a space where large groups are invited to take ownership of their problem solving and lead individual sessions. Open space technology is a great format when you have a great deal of expertise and insight in the room and want to allow for different takes and approaches on a particular theme or problem you need to be solved.

Start by bringing your participants together to align around a central theme and focus their efforts. Explain the ground rules to help guide the problem-solving process and then invite members to identify any issue connecting to the central theme that they are interested in and are prepared to take responsibility for.

Once participants have decided on their approach to the core theme, they write their issue on a piece of paper, announce it to the group, pick a session time and place, and post the paper on the wall. As the wall fills up with sessions, the group is then invited to join the sessions that interest them the most and which they can contribute to, then you’re ready to begin!

Everyone joins the problem-solving group they’ve signed up to, record the discussion and if appropriate, findings can then be shared with the rest of the group afterward.

Open Space Technology   #action plan   #idea generation   #problem solving   #issue analysis   #large group   #online   #remote-friendly   Open Space is a methodology for large groups to create their agenda discerning important topics for discussion, suitable for conferences, community gatherings and whole system facilitation

Techniques to identify and analyze problems

Using a problem-solving method to help a team identify and analyze a problem can be a quick and effective addition to any workshop or meeting.

While further actions are always necessary, you can generate momentum and alignment easily, and these activities are a great place to get started.

We’ve put together this list of techniques to help you and your team with problem identification, analysis, and discussion that sets the foundation for developing effective solutions.

Let’s take a look!

  • The Creativity Dice
  • Fishbone Analysis
  • Problem Tree
  • SWOT Analysis
  • Agreement-Certainty Matrix
  • The Journalistic Six
  • LEGO Challenge
  • What, So What, Now What?
  • Journalists

Individual and group perspectives are incredibly important, but what happens if people are set in their minds and need a change of perspective in order to approach a problem more effectively?

Flip It is a method we love because it is both simple to understand and run, and allows groups to understand how their perspectives and biases are formed. 

Participants in Flip It are first invited to consider concerns, issues, or problems from a perspective of fear and write them on a flip chart. Then, the group is asked to consider those same issues from a perspective of hope and flip their understanding.  

No problem and solution is free from existing bias and by changing perspectives with Flip It, you can then develop a problem solving model quickly and effectively.

Flip It!   #gamestorming   #problem solving   #action   Often, a change in a problem or situation comes simply from a change in our perspectives. Flip It! is a quick game designed to show players that perspectives are made, not born.

10. The Creativity Dice

One of the most useful problem solving skills you can teach your team is of approaching challenges with creativity, flexibility, and openness. Games like The Creativity Dice allow teams to overcome the potential hurdle of too much linear thinking and approach the process with a sense of fun and speed. 

In The Creativity Dice, participants are organized around a topic and roll a dice to determine what they will work on for a period of 3 minutes at a time. They might roll a 3 and work on investigating factual information on the chosen topic. They might roll a 1 and work on identifying the specific goals, standards, or criteria for the session.

Encouraging rapid work and iteration while asking participants to be flexible are great skills to cultivate. Having a stage for idea incubation in this game is also important. Moments of pause can help ensure the ideas that are put forward are the most suitable. 

The Creativity Dice   #creativity   #problem solving   #thiagi   #issue analysis   Too much linear thinking is hazardous to creative problem solving. To be creative, you should approach the problem (or the opportunity) from different points of view. You should leave a thought hanging in mid-air and move to another. This skipping around prevents premature closure and lets your brain incubate one line of thought while you consciously pursue another.

11. Fishbone Analysis

Organizational or team challenges are rarely simple, and it’s important to remember that one problem can be an indication of something that goes deeper and may require further consideration to be solved.

Fishbone Analysis helps groups to dig deeper and understand the origins of a problem. It’s a great example of a root cause analysis method that is simple for everyone on a team to get their head around. 

Participants in this activity are asked to annotate a diagram of a fish, first adding the problem or issue to be worked on at the head of a fish before then brainstorming the root causes of the problem and adding them as bones on the fish. 

Using abstractions such as a diagram of a fish can really help a team break out of their regular thinking and develop a creative approach.

Fishbone Analysis   #problem solving   ##root cause analysis   #decision making   #online facilitation   A process to help identify and understand the origins of problems, issues or observations.

12. Problem Tree 

Encouraging visual thinking can be an essential part of many strategies. By simply reframing and clarifying problems, a group can move towards developing a problem solving model that works for them. 

In Problem Tree, groups are asked to first brainstorm a list of problems – these can be design problems, team problems or larger business problems – and then organize them into a hierarchy. The hierarchy could be from most important to least important or abstract to practical, though the key thing with problem solving games that involve this aspect is that your group has some way of managing and sorting all the issues that are raised.

Once you have a list of problems that need to be solved and have organized them accordingly, you’re then well-positioned for the next problem solving steps.

Problem tree   #define intentions   #create   #design   #issue analysis   A problem tree is a tool to clarify the hierarchy of problems addressed by the team within a design project; it represents high level problems or related sublevel problems.

13. SWOT Analysis

Chances are you’ve heard of the SWOT Analysis before. This problem-solving method focuses on identifying strengths, weaknesses, opportunities, and threats is a tried and tested method for both individuals and teams.

Start by creating a desired end state or outcome and bare this in mind – any process solving model is made more effective by knowing what you are moving towards. Create a quadrant made up of the four categories of a SWOT analysis and ask participants to generate ideas based on each of those quadrants.

Once you have those ideas assembled in their quadrants, cluster them together based on their affinity with other ideas. These clusters are then used to facilitate group conversations and move things forward. 

SWOT analysis   #gamestorming   #problem solving   #action   #meeting facilitation   The SWOT Analysis is a long-standing technique of looking at what we have, with respect to the desired end state, as well as what we could improve on. It gives us an opportunity to gauge approaching opportunities and dangers, and assess the seriousness of the conditions that affect our future. When we understand those conditions, we can influence what comes next.

14. Agreement-Certainty Matrix

Not every problem-solving approach is right for every challenge, and deciding on the right method for the challenge at hand is a key part of being an effective team.

The Agreement Certainty matrix helps teams align on the nature of the challenges facing them. By sorting problems from simple to chaotic, your team can understand what methods are suitable for each problem and what they can do to ensure effective results. 

If you are already using Liberating Structures techniques as part of your problem-solving strategy, the Agreement-Certainty Matrix can be an invaluable addition to your process. We’ve found it particularly if you are having issues with recurring problems in your organization and want to go deeper in understanding the root cause. 

Agreement-Certainty Matrix   #issue analysis   #liberating structures   #problem solving   You can help individuals or groups avoid the frequent mistake of trying to solve a problem with methods that are not adapted to the nature of their challenge. The combination of two questions makes it possible to easily sort challenges into four categories: simple, complicated, complex , and chaotic .  A problem is simple when it can be solved reliably with practices that are easy to duplicate.  It is complicated when experts are required to devise a sophisticated solution that will yield the desired results predictably.  A problem is complex when there are several valid ways to proceed but outcomes are not predictable in detail.  Chaotic is when the context is too turbulent to identify a path forward.  A loose analogy may be used to describe these differences: simple is like following a recipe, complicated like sending a rocket to the moon, complex like raising a child, and chaotic is like the game “Pin the Tail on the Donkey.”  The Liberating Structures Matching Matrix in Chapter 5 can be used as the first step to clarify the nature of a challenge and avoid the mismatches between problems and solutions that are frequently at the root of chronic, recurring problems.

Organizing and charting a team’s progress can be important in ensuring its success. SQUID (Sequential Question and Insight Diagram) is a great model that allows a team to effectively switch between giving questions and answers and develop the skills they need to stay on track throughout the process. 

Begin with two different colored sticky notes – one for questions and one for answers – and with your central topic (the head of the squid) on the board. Ask the group to first come up with a series of questions connected to their best guess of how to approach the topic. Ask the group to come up with answers to those questions, fix them to the board and connect them with a line. After some discussion, go back to question mode by responding to the generated answers or other points on the board.

It’s rewarding to see a diagram grow throughout the exercise, and a completed SQUID can provide a visual resource for future effort and as an example for other teams.

SQUID   #gamestorming   #project planning   #issue analysis   #problem solving   When exploring an information space, it’s important for a group to know where they are at any given time. By using SQUID, a group charts out the territory as they go and can navigate accordingly. SQUID stands for Sequential Question and Insight Diagram.

16. Speed Boat

To continue with our nautical theme, Speed Boat is a short and sweet activity that can help a team quickly identify what employees, clients or service users might have a problem with and analyze what might be standing in the way of achieving a solution.

Methods that allow for a group to make observations, have insights and obtain those eureka moments quickly are invaluable when trying to solve complex problems.

In Speed Boat, the approach is to first consider what anchors and challenges might be holding an organization (or boat) back. Bonus points if you are able to identify any sharks in the water and develop ideas that can also deal with competitors!   

Speed Boat   #gamestorming   #problem solving   #action   Speedboat is a short and sweet way to identify what your employees or clients don’t like about your product/service or what’s standing in the way of a desired goal.

17. The Journalistic Six

Some of the most effective ways of solving problems is by encouraging teams to be more inclusive and diverse in their thinking.

Based on the six key questions journalism students are taught to answer in articles and news stories, The Journalistic Six helps create teams to see the whole picture. By using who, what, when, where, why, and how to facilitate the conversation and encourage creative thinking, your team can make sure that the problem identification and problem analysis stages of the are covered exhaustively and thoughtfully. Reporter’s notebook and dictaphone optional.

The Journalistic Six – Who What When Where Why How   #idea generation   #issue analysis   #problem solving   #online   #creative thinking   #remote-friendly   A questioning method for generating, explaining, investigating ideas.

18. LEGO Challenge

Now for an activity that is a little out of the (toy) box. LEGO Serious Play is a facilitation methodology that can be used to improve creative thinking and problem-solving skills. 

The LEGO Challenge includes giving each member of the team an assignment that is hidden from the rest of the group while they create a structure without speaking.

What the LEGO challenge brings to the table is a fun working example of working with stakeholders who might not be on the same page to solve problems. Also, it’s LEGO! Who doesn’t love LEGO! 

LEGO Challenge   #hyperisland   #team   A team-building activity in which groups must work together to build a structure out of LEGO, but each individual has a secret “assignment” which makes the collaborative process more challenging. It emphasizes group communication, leadership dynamics, conflict, cooperation, patience and problem solving strategy.

19. What, So What, Now What?

If not carefully managed, the problem identification and problem analysis stages of the problem-solving process can actually create more problems and misunderstandings.

The What, So What, Now What? problem-solving activity is designed to help collect insights and move forward while also eliminating the possibility of disagreement when it comes to identifying, clarifying, and analyzing organizational or work problems. 

Facilitation is all about bringing groups together so that might work on a shared goal and the best problem-solving strategies ensure that teams are aligned in purpose, if not initially in opinion or insight.

Throughout the three steps of this game, you give everyone on a team to reflect on a problem by asking what happened, why it is important, and what actions should then be taken. 

This can be a great activity for bringing our individual perceptions about a problem or challenge and contextualizing it in a larger group setting. This is one of the most important problem-solving skills you can bring to your organization.

W³ – What, So What, Now What?   #issue analysis   #innovation   #liberating structures   You can help groups reflect on a shared experience in a way that builds understanding and spurs coordinated action while avoiding unproductive conflict. It is possible for every voice to be heard while simultaneously sifting for insights and shaping new direction. Progressing in stages makes this practical—from collecting facts about What Happened to making sense of these facts with So What and finally to what actions logically follow with Now What . The shared progression eliminates most of the misunderstandings that otherwise fuel disagreements about what to do. Voila!

20. Journalists  

Problem analysis can be one of the most important and decisive stages of all problem-solving tools. Sometimes, a team can become bogged down in the details and are unable to move forward.

Journalists is an activity that can avoid a group from getting stuck in the problem identification or problem analysis stages of the process.

In Journalists, the group is invited to draft the front page of a fictional newspaper and figure out what stories deserve to be on the cover and what headlines those stories will have. By reframing how your problems and challenges are approached, you can help a team move productively through the process and be better prepared for the steps to follow.

Journalists   #vision   #big picture   #issue analysis   #remote-friendly   This is an exercise to use when the group gets stuck in details and struggles to see the big picture. Also good for defining a vision.

Problem-solving techniques for developing solutions 

The success of any problem-solving process can be measured by the solutions it produces. After you’ve defined the issue, explored existing ideas, and ideated, it’s time to narrow down to the correct solution.

Use these problem-solving techniques when you want to help your team find consensus, compare possible solutions, and move towards taking action on a particular problem.

  • Improved Solutions
  • Four-Step Sketch
  • 15% Solutions
  • How-Now-Wow matrix
  • Impact Effort Matrix

21. Mindspin  

Brainstorming is part of the bread and butter of the problem-solving process and all problem-solving strategies benefit from getting ideas out and challenging a team to generate solutions quickly. 

With Mindspin, participants are encouraged not only to generate ideas but to do so under time constraints and by slamming down cards and passing them on. By doing multiple rounds, your team can begin with a free generation of possible solutions before moving on to developing those solutions and encouraging further ideation. 

This is one of our favorite problem-solving activities and can be great for keeping the energy up throughout the workshop. Remember the importance of helping people become engaged in the process – energizing problem-solving techniques like Mindspin can help ensure your team stays engaged and happy, even when the problems they’re coming together to solve are complex. 

MindSpin   #teampedia   #idea generation   #problem solving   #action   A fast and loud method to enhance brainstorming within a team. Since this activity has more than round ideas that are repetitive can be ruled out leaving more creative and innovative answers to the challenge.

22. Improved Solutions

After a team has successfully identified a problem and come up with a few solutions, it can be tempting to call the work of the problem-solving process complete. That said, the first solution is not necessarily the best, and by including a further review and reflection activity into your problem-solving model, you can ensure your group reaches the best possible result. 

One of a number of problem-solving games from Thiagi Group, Improved Solutions helps you go the extra mile and develop suggested solutions with close consideration and peer review. By supporting the discussion of several problems at once and by shifting team roles throughout, this problem-solving technique is a dynamic way of finding the best solution. 

Improved Solutions   #creativity   #thiagi   #problem solving   #action   #team   You can improve any solution by objectively reviewing its strengths and weaknesses and making suitable adjustments. In this creativity framegame, you improve the solutions to several problems. To maintain objective detachment, you deal with a different problem during each of six rounds and assume different roles (problem owner, consultant, basher, booster, enhancer, and evaluator) during each round. At the conclusion of the activity, each player ends up with two solutions to her problem.

23. Four Step Sketch

Creative thinking and visual ideation does not need to be confined to the opening stages of your problem-solving strategies. Exercises that include sketching and prototyping on paper can be effective at the solution finding and development stage of the process, and can be great for keeping a team engaged. 

By going from simple notes to a crazy 8s round that involves rapidly sketching 8 variations on their ideas before then producing a final solution sketch, the group is able to iterate quickly and visually. Problem-solving techniques like Four-Step Sketch are great if you have a group of different thinkers and want to change things up from a more textual or discussion-based approach.

Four-Step Sketch   #design sprint   #innovation   #idea generation   #remote-friendly   The four-step sketch is an exercise that helps people to create well-formed concepts through a structured process that includes: Review key information Start design work on paper,  Consider multiple variations , Create a detailed solution . This exercise is preceded by a set of other activities allowing the group to clarify the challenge they want to solve. See how the Four Step Sketch exercise fits into a Design Sprint

24. 15% Solutions

Some problems are simpler than others and with the right problem-solving activities, you can empower people to take immediate actions that can help create organizational change. 

Part of the liberating structures toolkit, 15% solutions is a problem-solving technique that focuses on finding and implementing solutions quickly. A process of iterating and making small changes quickly can help generate momentum and an appetite for solving complex problems.

Problem-solving strategies can live and die on whether people are onboard. Getting some quick wins is a great way of getting people behind the process.   

It can be extremely empowering for a team to realize that problem-solving techniques can be deployed quickly and easily and delineate between things they can positively impact and those things they cannot change. 

15% Solutions   #action   #liberating structures   #remote-friendly   You can reveal the actions, however small, that everyone can do immediately. At a minimum, these will create momentum, and that may make a BIG difference.  15% Solutions show that there is no reason to wait around, feel powerless, or fearful. They help people pick it up a level. They get individuals and the group to focus on what is within their discretion instead of what they cannot change.  With a very simple question, you can flip the conversation to what can be done and find solutions to big problems that are often distributed widely in places not known in advance. Shifting a few grains of sand may trigger a landslide and change the whole landscape.

25. How-Now-Wow Matrix

The problem-solving process is often creative, as complex problems usually require a change of thinking and creative response in order to find the best solutions. While it’s common for the first stages to encourage creative thinking, groups can often gravitate to familiar solutions when it comes to the end of the process. 

When selecting solutions, you don’t want to lose your creative energy! The How-Now-Wow Matrix from Gamestorming is a great problem-solving activity that enables a group to stay creative and think out of the box when it comes to selecting the right solution for a given problem.

Problem-solving techniques that encourage creative thinking and the ideation and selection of new solutions can be the most effective in organisational change. Give the How-Now-Wow Matrix a go, and not just for how pleasant it is to say out loud. 

How-Now-Wow Matrix   #gamestorming   #idea generation   #remote-friendly   When people want to develop new ideas, they most often think out of the box in the brainstorming or divergent phase. However, when it comes to convergence, people often end up picking ideas that are most familiar to them. This is called a ‘creative paradox’ or a ‘creadox’. The How-Now-Wow matrix is an idea selection tool that breaks the creadox by forcing people to weigh each idea on 2 parameters.

26. Impact and Effort Matrix

All problem-solving techniques hope to not only find solutions to a given problem or challenge but to find the best solution. When it comes to finding a solution, groups are invited to put on their decision-making hats and really think about how a proposed idea would work in practice. 

The Impact and Effort Matrix is one of the problem-solving techniques that fall into this camp, empowering participants to first generate ideas and then categorize them into a 2×2 matrix based on impact and effort.

Activities that invite critical thinking while remaining simple are invaluable. Use the Impact and Effort Matrix to move from ideation and towards evaluating potential solutions before then committing to them. 

Impact and Effort Matrix   #gamestorming   #decision making   #action   #remote-friendly   In this decision-making exercise, possible actions are mapped based on two factors: effort required to implement and potential impact. Categorizing ideas along these lines is a useful technique in decision making, as it obliges contributors to balance and evaluate suggested actions before committing to them.

27. Dotmocracy

If you’ve followed each of the problem-solving steps with your group successfully, you should move towards the end of your process with heaps of possible solutions developed with a specific problem in mind. But how do you help a group go from ideation to putting a solution into action? 

Dotmocracy – or Dot Voting -is a tried and tested method of helping a team in the problem-solving process make decisions and put actions in place with a degree of oversight and consensus. 

One of the problem-solving techniques that should be in every facilitator’s toolbox, Dot Voting is fast and effective and can help identify the most popular and best solutions and help bring a group to a decision effectively. 

Dotmocracy   #action   #decision making   #group prioritization   #hyperisland   #remote-friendly   Dotmocracy is a simple method for group prioritization or decision-making. It is not an activity on its own, but a method to use in processes where prioritization or decision-making is the aim. The method supports a group to quickly see which options are most popular or relevant. The options or ideas are written on post-its and stuck up on a wall for the whole group to see. Each person votes for the options they think are the strongest, and that information is used to inform a decision.

All facilitators know that warm-ups and icebreakers are useful for any workshop or group process. Problem-solving workshops are no different.

Use these problem-solving techniques to warm up a group and prepare them for the rest of the process. Activating your group by tapping into some of the top problem-solving skills can be one of the best ways to see great outcomes from your session.

  • Check-in/Check-out
  • Doodling Together
  • Show and Tell
  • Constellations
  • Draw a Tree

28. Check-in / Check-out

Solid processes are planned from beginning to end, and the best facilitators know that setting the tone and establishing a safe, open environment can be integral to a successful problem-solving process.

Check-in / Check-out is a great way to begin and/or bookend a problem-solving workshop. Checking in to a session emphasizes that everyone will be seen, heard, and expected to contribute. 

If you are running a series of meetings, setting a consistent pattern of checking in and checking out can really help your team get into a groove. We recommend this opening-closing activity for small to medium-sized groups though it can work with large groups if they’re disciplined!

Check-in / Check-out   #team   #opening   #closing   #hyperisland   #remote-friendly   Either checking-in or checking-out is a simple way for a team to open or close a process, symbolically and in a collaborative way. Checking-in/out invites each member in a group to be present, seen and heard, and to express a reflection or a feeling. Checking-in emphasizes presence, focus and group commitment; checking-out emphasizes reflection and symbolic closure.

29. Doodling Together  

Thinking creatively and not being afraid to make suggestions are important problem-solving skills for any group or team, and warming up by encouraging these behaviors is a great way to start. 

Doodling Together is one of our favorite creative ice breaker games – it’s quick, effective, and fun and can make all following problem-solving steps easier by encouraging a group to collaborate visually. By passing cards and adding additional items as they go, the workshop group gets into a groove of co-creation and idea development that is crucial to finding solutions to problems. 

Doodling Together   #collaboration   #creativity   #teamwork   #fun   #team   #visual methods   #energiser   #icebreaker   #remote-friendly   Create wild, weird and often funny postcards together & establish a group’s creative confidence.

30. Show and Tell

You might remember some version of Show and Tell from being a kid in school and it’s a great problem-solving activity to kick off a session.

Asking participants to prepare a little something before a workshop by bringing an object for show and tell can help them warm up before the session has even begun! Games that include a physical object can also help encourage early engagement before moving onto more big-picture thinking.

By asking your participants to tell stories about why they chose to bring a particular item to the group, you can help teams see things from new perspectives and see both differences and similarities in the way they approach a topic. Great groundwork for approaching a problem-solving process as a team! 

Show and Tell   #gamestorming   #action   #opening   #meeting facilitation   Show and Tell taps into the power of metaphors to reveal players’ underlying assumptions and associations around a topic The aim of the game is to get a deeper understanding of stakeholders’ perspectives on anything—a new project, an organizational restructuring, a shift in the company’s vision or team dynamic.

31. Constellations

Who doesn’t love stars? Constellations is a great warm-up activity for any workshop as it gets people up off their feet, energized, and ready to engage in new ways with established topics. It’s also great for showing existing beliefs, biases, and patterns that can come into play as part of your session.

Using warm-up games that help build trust and connection while also allowing for non-verbal responses can be great for easing people into the problem-solving process and encouraging engagement from everyone in the group. Constellations is great in large spaces that allow for movement and is definitely a practical exercise to allow the group to see patterns that are otherwise invisible. 

Constellations   #trust   #connection   #opening   #coaching   #patterns   #system   Individuals express their response to a statement or idea by standing closer or further from a central object. Used with teams to reveal system, hidden patterns, perspectives.

32. Draw a Tree

Problem-solving games that help raise group awareness through a central, unifying metaphor can be effective ways to warm-up a group in any problem-solving model.

Draw a Tree is a simple warm-up activity you can use in any group and which can provide a quick jolt of energy. Start by asking your participants to draw a tree in just 45 seconds – they can choose whether it will be abstract or realistic. 

Once the timer is up, ask the group how many people included the roots of the tree and use this as a means to discuss how we can ignore important parts of any system simply because they are not visible.

All problem-solving strategies are made more effective by thinking of problems critically and by exposing things that may not normally come to light. Warm-up games like Draw a Tree are great in that they quickly demonstrate some key problem-solving skills in an accessible and effective way.

Draw a Tree   #thiagi   #opening   #perspectives   #remote-friendly   With this game you can raise awarness about being more mindful, and aware of the environment we live in.

Each step of the problem-solving workshop benefits from an intelligent deployment of activities, games, and techniques. Bringing your session to an effective close helps ensure that solutions are followed through on and that you also celebrate what has been achieved.

Here are some problem-solving activities you can use to effectively close a workshop or meeting and ensure the great work you’ve done can continue afterward.

  • One Breath Feedback
  • Who What When Matrix
  • Response Cards

How do I conclude a problem-solving process?

All good things must come to an end. With the bulk of the work done, it can be tempting to conclude your workshop swiftly and without a moment to debrief and align. This can be problematic in that it doesn’t allow your team to fully process the results or reflect on the process.

At the end of an effective session, your team will have gone through a process that, while productive, can be exhausting. It’s important to give your group a moment to take a breath, ensure that they are clear on future actions, and provide short feedback before leaving the space. 

The primary purpose of any problem-solving method is to generate solutions and then implement them. Be sure to take the opportunity to ensure everyone is aligned and ready to effectively implement the solutions you produced in the workshop.

Remember that every process can be improved and by giving a short moment to collect feedback in the session, you can further refine your problem-solving methods and see further success in the future too.

33. One Breath Feedback

Maintaining attention and focus during the closing stages of a problem-solving workshop can be tricky and so being concise when giving feedback can be important. It’s easy to incur “death by feedback” should some team members go on for too long sharing their perspectives in a quick feedback round. 

One Breath Feedback is a great closing activity for workshops. You give everyone an opportunity to provide feedback on what they’ve done but only in the space of a single breath. This keeps feedback short and to the point and means that everyone is encouraged to provide the most important piece of feedback to them. 

One breath feedback   #closing   #feedback   #action   This is a feedback round in just one breath that excels in maintaining attention: each participants is able to speak during just one breath … for most people that’s around 20 to 25 seconds … unless of course you’ve been a deep sea diver in which case you’ll be able to do it for longer.

34. Who What When Matrix 

Matrices feature as part of many effective problem-solving strategies and with good reason. They are easily recognizable, simple to use, and generate results.

The Who What When Matrix is a great tool to use when closing your problem-solving session by attributing a who, what and when to the actions and solutions you have decided upon. The resulting matrix is a simple, easy-to-follow way of ensuring your team can move forward. 

Great solutions can’t be enacted without action and ownership. Your problem-solving process should include a stage for allocating tasks to individuals or teams and creating a realistic timeframe for those solutions to be implemented or checked out. Use this method to keep the solution implementation process clear and simple for all involved. 

Who/What/When Matrix   #gamestorming   #action   #project planning   With Who/What/When matrix, you can connect people with clear actions they have defined and have committed to.

35. Response cards

Group discussion can comprise the bulk of most problem-solving activities and by the end of the process, you might find that your team is talked out! 

Providing a means for your team to give feedback with short written notes can ensure everyone is head and can contribute without the need to stand up and talk. Depending on the needs of the group, giving an alternative can help ensure everyone can contribute to your problem-solving model in the way that makes the most sense for them.

Response Cards is a great way to close a workshop if you are looking for a gentle warm-down and want to get some swift discussion around some of the feedback that is raised. 

Response Cards   #debriefing   #closing   #structured sharing   #questions and answers   #thiagi   #action   It can be hard to involve everyone during a closing of a session. Some might stay in the background or get unheard because of louder participants. However, with the use of Response Cards, everyone will be involved in providing feedback or clarify questions at the end of a session.

Save time and effort discovering the right solutions

A structured problem solving process is a surefire way of solving tough problems, discovering creative solutions and driving organizational change. But how can you design for successful outcomes?

With SessionLab, it’s easy to design engaging workshops that deliver results. Drag, drop and reorder blocks  to build your agenda. When you make changes or update your agenda, your session  timing   adjusts automatically , saving you time on manual adjustments.

Collaborating with stakeholders or clients? Share your agenda with a single click and collaborate in real-time. No more sending documents back and forth over email.

Explore  how to use SessionLab  to design effective problem solving workshops or  watch this five minute video  to see the planner in action!

business to business problem solving

Over to you

The problem-solving process can often be as complicated and multifaceted as the problems they are set-up to solve. With the right problem-solving techniques and a mix of creative exercises designed to guide discussion and generate purposeful ideas, we hope we’ve given you the tools to find the best solutions as simply and easily as possible.

Is there a problem-solving technique that you are missing here? Do you have a favorite activity or method you use when facilitating? Let us know in the comments below, we’d love to hear from you! 

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Facilitation skills are the abilities you need in order to master working with a group. In essence, facilitation is about being aware of what happens when people get together to achieve a common goal, and directing their focus and attention in ways that serve the group itself.  When we work together at our best, we can achieve a lot more than anything we might attempt alone. Working with others is not always easy: teamwork is fraught with risks and pitfalls, but skilled facilitation can help navigate them with confidence. With the right approach, facilitation can be a workplace superpower.  Whatever your position, career path, or life story, you probably have…

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Effective online tools are a necessity for smooth and engaging virtual workshops and meetings. But how do you choose the right ones? Do you sometimes feel that the good old pen and paper or MS Office toolkit and email leaves you struggling to stay on top of managing and delivering your workshop? Fortunately, there are plenty of online tools to make your life easier when you need to facilitate a meeting and lead workshops. In this post, we’ll share our favorite online tools you can use to make your job as a facilitator easier. In fact, there are plenty of free online workshop tools and meeting facilitation software you can…

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How do Great Leaders Solve Problems in Business?


Category: Behavioral Economics .

Companies today are expected to adapt and respond quickly to challenges in a rapidly changing business environment. Notwithstanding sound planning and flawless strategy execution, businesses can still face problems. While they foresee some of those problems, others can pop up unexpectedly. These unforeseeable problems make it essential for businesses to be agile enough to respond to those challenges quickly and have excellent problem-solving skills to navigate them successfully. Problem-solving is an indispensable part of business management.

In this article, we will examine the following in detail


  • Understanding the Importance of Problem-Solving in Business
  • Types of Business Problems
  • Challenges in Problem-solving
  • Skills Required for Effective Problem-solving in Business
  • A Step-by-step Process to Problem-solving in Business

TL;DR Version

Problem-solving is integral to business success, dealing with diverse issues ranging from operational hiccups to strategic challenges. Identifying and understanding these problems is vital, but navigating potential obstacles during problem-solving, such as cognitive biases, resource constraints, and lack of information, is crucial.

Effective problem-solving skills include research and analytical abilities, creativity, decision-making, communication , time management, and leadership. These skills allow business leaders to dissect complex issues, ideate innovative solutions, make informed decisions, communicate effectively, manage time, and lead teams toward resolution.

The problem-solving process involves defining the problem, understanding its root cause, collecting relevant information, brainstorming potential solutions, evaluating these solutions, choosing the best one, developing and implementing an action plan, monitoring progress, evaluating results, and reflecting on the process for continuous improvement. This iterative process ensures that businesses are resolving immediate issues and refining their problem-solving mechanism for future challenges.

Unmanaged and unmitigated problems can cause severe consequences to businesses. They can lead to project delays, missed deadlines, and financial losses. Moreover, they may negatively impact employee morale and customer satisfaction and even damage the reputation of the company. So businesses must have strong problem-solving abilities.

When businesses have strong problem-solving abilities, they can quickly and proactively rise to the occasion and address the problems, minimizing their impact, preventing them from escalating into bigger problems, and capitalizing on opportunities that arise from those challenges. Ultimately, the problem-solving ability of a company can help them gain a competitive advantage.

To solve problems and fix issues, companies require leaders who can handle complex issues with ease and guide and motivate their teams to identify problems and develop creative solutions to overcome them. They can leverage the collective expertise and experience of the employees to make well-informed decisions that align with the business goals and objectives. Leaders also work with employees to foster a culture of problem-solving to help the company build a resilient business that can thrive in today’s dynamic business environment.

What is Problem-Solving in Business?

Problem-solving involves identifying, analyzing, and resolving issues or challenges arising during various business operations to achieve the desired outcomes and business goals. It involves a systematic approach to defining the problem, gathering relevant information, generating possible solutions, evaluating them, and implementing the best course of action.

Take action today and start paving the way for your business towards Problem- solving.

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we Cannot solve our problems with the same thinking we used when we created them. Albert Einstein

Why is Problem-Solving Important?

Problem-solving in business is important because of the following reasons.

1. Efficiency

Problems not only hinder progress but also reduce the efficiency of your operations by bringing everything to a halt/slowing you down, causing downtime, and costing you precious productivity. When left unchecked at the initial stages, these problems may also demand additional resources and budget to solve them, leading to cost overruns, losses, and inefficiency. So addressing the problems on time can help achieve efficiency.

2. Profitability

Profitability is one of the topmost priorities of an organization. So any impact on profitability is seen as a problem that requires immediate attention. Effective problem-solving helps businesses identify and address cost inefficiencies, optimize processes, and capitalize on new opportunities, thus improving the bottom line.

3. Leadership

Great leaders emerge during testing times. They can lead the employees, leverage collective effort and give a sense of direction toward finding solutions and workarounds. Problem-solving helps companies identify the right leaders.

4. Teamwork

Problem-solving requires team effort and participation. It calls for collaboration and communication between various departments, teams, and individuals. When companies manage to weather challenges and solve problems effectively, it brings the employees together to work towards a common cause, build stronger teams and create a habit of continuous improvement.


5. Innovation

Problem-solving requires creativity and innovation to find solutions and workarounds. When a company fosters problem-solving culture, it automatically imbibes creative thinking and innovation. It gets reflected in developing new products, services, processes, and best practices.

6. Customer Satisfaction

Customer satisfaction helps businesses retain and find new customers. Problems with the products/services and customer support can lead to poor customer experience. Effective problem-solving helps businesses resolve customer complaints and issues quickly and satisfactorily, thus increasing customer loyalty and retention.

The Problems that Businesses Face Today and how they Solve Them

There are several different kinds of problems that businesses face, including

1. Strategic problems

Strategic problems are related to the long-term direction of a business. They typically involve decisions about resource allocation, product strategy, choosing the market, pricing strategy, product positioning, etc. Solving strategic problems requires a long-term vision, able leadership, and the ability to forecast market trends.


Business problem examples

Selecting the markets.

Businesses need to decide their focus on specific geographic markets, target customer segments, and product categories. They must make these decisions and select the focus areas by analyzing the data and insights into factors, including market size, competition, and the company’s core competencies.

Product development

Developing new products enables companies to remain relevant and achieve leadership in a highly competitive market scenario. They have to meet the customer requirements and provide a compelling reason for customers to purchase them. Solving the problem of new product development requires creativity and innovation and allocating resources for R&D. New products should be developed based on sound market analyses of customer requirements and pain points.

For instance, the need to learn and upskill anytime without compromising work hours pushed the companies to create e-learning platforms.

Positioning the company

Differentiating your business from the competition involves developing a strong brand identity, focusing on a specific niche or segment of the market, or offering unique value propositions. Setting the company apart by gaining a competitive advantage attracts customers. You can solve the problem of positioning your company by doing a SWOT analysis, finding your strengths and unique qualities that enable you to meet the customers’ requirements and address their pain points. You can base your brand identity, USP, and niche on your stand-out qualities that benefit customers. For instance, Volvo positions itself as the company that makes the safest cars in the world.

2. Operational problems

Operational problems are daily issues that hinder companies from efficiently delivering products or services to customers, affecting their ability to meet deadlines and targets. These problems arise from bottlenecks, inefficiencies, and system flaws. Addressing them involves identifying issues, providing employee training, upgrading technology, ensuring product testing and quality control, and implementing contingency planning, deadline management, and risk mitigation.


Business problem-solving examples

Supply chain disruptions.

Supply chain disruptions happen when businesses face challenges in sourcing raw materials or components, leading to production delays or quality issues. For instance, during the pandemic, companies faced chip shortages, which led to losses and the inability to deliver products to customers on time. It also caused a rise in demand and an increase in prices.

Quality control issues

Quality control issues occur when design flaws or manufacturing issues impact the products. Businesses may need to identify and address quality issues to maintain customer satisfaction and loyalty. For instance, it is not uncommon to recall new automobile models, sometimes the ones from specific batches, to replace faulty components with redesigned parts before they might fail.

Managing staffing levels

Fluctuating staffing needs are part of operational issues. At any given time, if a company is understaffed, it can lead to operational inefficiency; if it is over-staffed, the company will suffer from cost infficiency. So, it requires careful planning. You can address the problem by either recruiting or downsizing and restructuring. For instance, the tech companies that designed software solutions for remote and hybrid work environments hired many employees during the pandemic. After the pandemic, when the need for these software solutions decreased, they had to downsize their workforce in light of the impending recession.

3. Financial problems

Financial problems are issues involving managing cash flow, revenue growth, and expenses. They are related to the financial health of a business. Businesses can fix them by managing costs effectively through process improvement and cost-cutting measures.


Managing cash flow

Businesses must ensure that they have enough financial resources on hand to meet their obligations, such as payroll, vendor payments, logistics, managing retail channels, etc. For instance, many start-ups stall despite successful product development and prototyping, as they fail to secure adequate funding to bring the products to the market.

Identifying new revenue streams:

Businesses that focus on a particular niche are always vulnerable to competition and changing market conditions. They need to diversify their revenue streams to maintain growth and profitability. They may have to focus on research and product development to identify new revenue streams. For instance, some of the most successful and established DSLR camera manufacturers faced a major crisis when mirrorless cameras started eating into their market share. They had to revise the product strategy, downsize their manpower, and invest vast resources into developing competitive mirrorless systems to mitigate the company. On the contrary, DSLR manufacturers with diversified businesses remained more resilient.

Managing costs

Businesses must control expenses to maintain profitability. It may involve identifying areas where costs can be cut or negotiating better deals with vendors. For instance, Google is known to initiate moonshot projects. At the same time, they kill non-profitable projects quickly. It has helped the company retain leadership while managing costs judiciously.

4. Human resource problems

HR problems are issues related to recruiting, retaining, and developing talent. They are issues about the management of employees. Managing these problems requires assessing staffing needs, recruiting, restructuring, identifying training and upskilling needs, and retaining top talent through employee engagement initiatives, welfare measures, and career development opportunities.


Retaining top talent

Retaining top talent can be a determining factor for the success of a company. Businesses must build an environment that attracts top talent by creating opportunities for career advancement and offering competitive compensation packages. For instance, highly specialized jobs with business-critical responsibilities, such as chief aero designers in motor racing teams, are hard to find and recruit. So retaining them is crucial for the success of the company.

Addressing employee morale and motivation issues

Lack of motivation, stagnant career, unfavorable team dynamics, etc., are some factors that cause a dip in employee morale. These factors can affect productivity and quality of work. Businesses must address these issues through employee engagement initiatives, career planning, team building, welfare measures, training, upskilling, etc.

Managing a diverse workforce

In an increasingly globalized work scenario, businesses must ensure that they create a work environment that is inclusive and welcoming to employees from different backgrounds and with diverse skill sets. They should also manage hybrid and remote work to address ambiguities and ensure clarity and synergy among teams and individuals based in various locations. For instance, many companies reserve certain positions for people of different racial/ethnic backgrounds or genders to meet their diversity goals. They also put policies and systems in place to prevent/address discrimination in the workplace.

Marketing problems

Marketing problems are related to promoting and selling a company’s products or services. Problems usually arise in understanding customer behavior and preferences and developing marketing strategies that appeal to those customers. Solving marketing problems requires revisiting the marketing strategy, understanding customer needs and behaviors by analyzing data, positioning the products more appealingly, and branding them better to reflect the strengths of the company and its product offerings.

Understanding customer needs and behavior

Customer needs to dictate the direction of product development and positioning. To design and deliver successful products, businesses must gain a deep understanding of customer needs, preferences, and pain points. For instance, the Japanese car makers capitalized on the high gas prices during the oil crisis and managed to capture the market in the US with their more efficient and reliable cars. The sudden loss in interest in the large, thirsty cars caused a considerable shift in the market, allowing Japanese car manufacturers to position their products in line with the customers’ preferences and succeed.

Developing a strong brand identity

Businesses must create a brand identity that resonates with the customers and sets them apart from competitors. For instance, it is common for companies to change their logo and brand identity in line with the changing trends, customer preferences, and product strategy.

Identifying new marketing channels and tactics

Businesses must be able to identify and adapt to changing customer preferences and identify new channels and tactics for reaching those customers. For instance, many retail businesses have adopted an eCommerce strategy to cater to mobile-savvy customers and to reach new markets.


What Skills do Business Leaders Require for Effective Problem-Solving?

Following are some of the skills required for effective problem-solving in business.

1. Research and analytical skills

Problems have various potential implications. Trying to solve them straight away without doing proper research can cause further problems. Business leaders should study the problem to gain a deeper understanding, assess the solutions thoroughly, and test them before deploying them. They also need good analytical skills to review the performance metrics that indicate the problem areas and analyze information and data to understand the problem. Analytical skills help business leaders break down complex problems into smaller, more manageable parts, identify their root causes, avoid bounded rationality in decision making , and develop effective solutions and creative workarounds.

2. Creativity

When the problems are complex and multi-dimensional, they may require unique solutions that never existed before. Finding solutions for these problems requires creativity and a culture of innovation in the company. Business leaders must think creatively and tread unconventional paths to create innovative solutions. For instance, during the pandemic, when customers did not want to take the risk of going to retail stores to buy things but were reluctant to pay for the high shipping costs involved in e-commerce, retail businesses offered solutions such as BOPIS that let customers order online and collect their purchases safely from collection booth/kiosk at a convenient time. It helped them meet customer needs by offering the best of both worlds

3. Decision-making

Effective problem-solving in business requires sound decision-making skills. Problem-solving often involves making choices and tough decisions. For instance, the decision to axe a product line that has performed well in the past but has no future potential is a tough one to make. But retaining it will cost resources and yield decreasing returns. Great business leaders evaluate multiple options/solutions and make decisions in the company’s best interest. Being decisive or having decision clarity also means making the right decisions at the right time. Delays in decision-making can cause severe consequences even if you ultimately make the right decision. So business leaders must analyze everything and make the right decision when it matters the most.

4. Communication

Business leaders cannot single-handedly solve problems. Problem-solving requires a team effort. Good business leaders harness the potential of every employee with their communication skills and excellent coordination. They communicate effectively with colleagues, customers, and stakeholders to identify problems and develop solutions. For instance, in a crowded restaurant, the chef needs to coordinate the kitchen staff continuously, check if they are doing their part efficiently, control food quality, and make sure that food is served at the right table as quickly as possible. Lack of communication from the chef can escalate into a full-fledged nightmare, where customers keep waiting for their orders, kitchen staff make mistakes and deliver poor quality food, and the waiters get the flak for not serving food on time. Such situations can ruin the reputation of the restaurant and lead to the loss of customer trust. So good business leaders must communicate and build synergy among the individuals within and among other teams to get work done effectively.

5. Marketing problems


6. Leadership

Problem-solving is about working with many individuals and bringing the best out of them. So business leaders need great leadership qualities to motivate and inspire their teams to work together and solve problems. For example, innovations come from the R&D department; they get incorporated into products by the product development team, and the products are positioned and promoted in the market by the marketing team. Great business leaders lead product development and deployment by coordinating with all these teams, getting their insights, considering their views, and making important decisions regarding product strategy, product positioning, and branding. Situational Leadership is essential to deal with shifting priorities. Leaders motivate the teams and guide them in the right direction. Without good leadership, a company cannot solve problems effectively.

A Step-by-Step Process to Problem-Solving in Business

Problem-solving in business is often an iterative process. So the steps involved may need to be repeated or revised as new information becomes available. Problem-solving usually involves the following steps:

  • Define the problem; include any present symptoms or effects.
  • Understand the root cause of the problem and find out how it impacts the business.
  • Collect all the necessary information related to the problem by analyzing data, conducting interviews, researching, and seeking input from others.
  • Brainstorm with the stakeholders and generate potential solutions to the problem. Encourage open communication, collaboration, and participation among team members.
  • Weigh the pros and cons, evaluate all the potential solutions, analyze the risks, and consider the feasibility of each.
  • Choose the best solution from the evaluated solutions and consider how it will impact the stakeholders, including customers, employees, suppliers, and shareholders.
  • Develop an action plan to implement the chosen solution, detailing specific steps, timelines, and responsibilities.
  • Implement the solution, monitor progress closely, adjust the plan, make changes as required, and communicate those changes to the stakeholders.
  • Evaluate the results, determine if the solution addressed the problem, assess its effectiveness, and identify any areas for improvement.
  • Reflect on the problem-solving process, and identify and document the lessons learned.
  • Consider how you can improve the process for future problem-solving efforts.

10 Steps-Guide-to-Business-Problem-Solving

Problem Solving Key Takeaways

Problem-solving is a critical skill for business success. It involves identifying, understanding, and resolving issues in various facets of business operations and strategy. Common obstacles during problem-solving can include cognitive biases, resource constraints, and lack of information. Business leaders must navigate these potential pitfalls to ensure effective resolution of issues.

Essential skills for effective problem-solving include research and analytical abilities, creativity, decision-making, communication, time management, and leadership. These skills enable business leaders to dissect complex issues, devise innovative solutions, make informed decisions, effectively communicate, manage time, and guide teams toward resolution.

Problem-solving is an iterative process that involves multiple stages, from defining the problem and understanding its root cause to brainstorming and evaluating potential solutions, choosing the best one, and developing and implementing an action plan. This process also includes monitoring progress, evaluating results, and reflecting on the process for continuous improvement. An effective problem-solving method is the root cause analysis method. Ultimately, successful problem-solving in business is not just about resolving immediate issues but also about refining and improving the problem-solving process to tackle future challenges more effectively.

Problem Solving in Business FAQs

Answer: The four types of problem-solving strategies typically include:

Trial and Error: Involves trying different solutions until the problem is solved. It’s often used when there are limited possibilities that can be explored quickly.

Algorithm: A step-by-step procedure that, if followed correctly, will always lead to the solution of the problem. It is highly logical and often used in mathematical problems.

Heuristic: A general problem-solving strategy that involves using rules-of-thumb or shortcuts. Heuristics may not always yield the perfect solution but can often lead to a satisfactory one in a reasonable time frame.

Insight: Sometimes also referred to as creative problem-solving. It involves sudden realization, a flash of inspiration, or an ‘Aha!’ moment that provides a solution.

  • What is an example of problem-solving in business?

Answer: A common example of problem-solving in business is addressing a sudden drop in sales. The problem-solving process would begin with identifying and defining the problem (drop in sales). The next step would involve researching and analyzing the issue to understand its root cause, such as market conditions, competition, or internal factors. Brainstorming for potential solutions could include improving the product, adjusting pricing, or enhancing marketing efforts. After evaluating and selecting the best solution, an action plan would be developed and implemented. Progress would be monitored, results evaluated, and the process reflected upon for future problem-solving efforts.

  • Why is problem-solving important in business?

Answer: Problem-solving is vital in business as it enables organizations to navigate challenges and obstacles that could hamper their growth and success. It allows businesses to identify issues, understand their implications, and devise effective solutions. This process not only resolves the immediate issue at hand but also helps prevent similar problems in the future. Moreover, effective problem-solving can lead to improved business processes, innovation, and a competitive advantage. It also plays a crucial role in customer satisfaction, profitability, and overall sustainability of the business.

  • What is the most important problem-solving tool for business?

Answer: There isn’t a one-size-fits-all problem-solving tool for all businesses, as the most effective tool often depends on the specific problem and the business context. However, one universally important tool is effective communication. Clear, open, and honest communication fosters better understanding of problems, facilitates brainstorming of solutions, and aids in the implementation of action plans. Other essential tools include data analysis tools (for understanding and diagnosing problems), brainstorming techniques (for generating solutions), and project management tools (for implementing solutions).

Great leaders possess a unique problem-solving mindset that enables them to navigate complex challenges in the business world. By following this step-by-step guide, you can cultivate these essential skills and unlock your potential for success. Remember, problem-solving is not just about finding solutions but also about fostering a culture of innovation, collaboration, and continuous improvement. Embrace the challenges, seize the opportunities, and lead confidently as you embark on your journey towards becoming an exceptional problem solver and a remarkable leader in the business realm.

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Move Fast and Fix Things: The Trusted Leader's Guide to Solving Hard Problems

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Move Fast and Fix Things: The Trusted Leader's Guide to Solving Hard Problems

By: Frances X. Frei, Anne Morriss

Bestselling authors and cohosts of the TED podcast "Fixable," Frances Frei and Anne Morriss reinvent the playbook for how to lead change--with a radical approach that moves fast, builds trust, and…

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  • Publication Date: Aug 15, 2023
  • Discipline: General Management
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Bestselling authors and cohosts of the TED podcast "Fixable," Frances Frei and Anne Morriss reinvent the playbook for how to lead change--with a radical approach that moves fast, builds trust, and accelerates excellence. Speed has gotten a bad name in business, much of it deserved. When Facebook made "Move fast and break things" an informal company motto, it fueled a widely held belief that we can either make progress or take care of people, one or the other. That a certain amount of wreckage is the price we have to pay for inventing the future. Leadership experts Frances Frei and Anne Morriss argue that this belief is deeply flawed--and that it keeps you from building a great company. Helping executives and entrepreneurs solve their toughest problems over the past decade, Frei and Morriss learned that the trade-off between speed and excellence is false. The best leaders solve hard problems with fierce urgency while making their organizations--employees, customers, and shareholders--even stronger. They move fast and fix things. Based on their work with fast-moving companies such as Uber, Riot Games, and WeWork, Frei and Morriss reveal the five essential steps to moving fast and fixing things. You'll learn to: Identify the real problem holding you back; Build and rebuild trust in your company; Create a culture where everyone can thrive; Communicate powerfully as a leader; Go fast by empowering your team. With a one-week plan to fix your problems on a fast cycle time of one step per day, this book is your guide to maximizing impact and reinventing your approach to change. By the end of the week, you won't just have a road map for solving your company's toughest problems--you'll already be well on your way, improving your company at exhilarating speed.

Aug 15, 2023


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What is Business Communication & Why Do You Need It?

July 27, 2022 12 min read

what is business communication and why do you need it

The way we communicate with others is such a habitual part of us that we rarely stop and think about it. This translates into business communication too. Organizations, after all, aren’t faceless entities, but groups of real people.

Effective communication affects processes, efficiency, and every layer of a company.

In this guide, we’ll cover all you need to know to set up a successful business communication process.

What is Business Communication? The Definition

Types of business communication.

  • Methods of Business Communication

Problems That Effective Business Communication Can Solve

  • How to Set Up Your Business Communication Process

Business communication is the process of sharing information between people within the workplace and outside a company.

Effective business communication is how employees and management interact to reach organizational goals. Its purpose is to improve organizational practices and reduce errors. It’s important to work on both your communication skills and communication processes to achieve effective business communication. 

The importance of business communication also lies in:

  • Presenting options/new business ideas
  • Making plans and proposals (business writing)
  • Executing decisions
  • Reaching agreements
  • Sending and fulfilling orders
  • Successful selling
  • Effective meetings
  • Providing feedback to employees and customers

All organized activity in a company relies on the process of business communication and your communication strategy. This could be anything from managerial communication to technical communication with vendors.

And once communication becomes unclear, the company’s core systems risk falling apart. Data shows that 60% of internal communications professionals do not measure internal communications. Potential reasons include not knowing where to start, the next steps, or how to calculate ROI .

Business communications solution from Nextiva.

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Why is business communication important?

Voice solutions like VoIP ( Nextiva or other alternatives ) will likely result in higher employee engagement. And companies with connected employees in the workplace have seen a spike in productivity of up to 25%.

business to business problem solving

Companies with an engaged workforce see a 19.2% growth in operating income over a 12-month period. Those with low engagement scores earn 32.7% less.

How much more successful would you be if you had better employee engagement?

And how can you ensure a business communication process that will make it possible?

Let’s first differentiate the main types of communication in a typical organization.

First, we have internal business communication.

Internal business communication can be:

  • Upward communication: any communication that comes from a subordinate to a manager. Or from another person up the organizational hierarchy.
  • Downward communication/Managerial communication : anything that comes from a superior to a subordinate.
  • Lateral communication/Technical communication : internal or cross-departmental communication between coworkers

Then, there is external business communication .

External business communication is any messaging that leaves your office and internal staff. It involves dealing with customers, vendors, or anything that impacts your brand.

You can sort all communication in this spectrum into four types of business communication.

  • Getting and receiving instructions and assignments both upward and downward. This includes an effective delegation from one person to another. Most problems in business begin with unclear communications in this area.
  • Sharing and discussing information, including information sharing that goes on in meetings. When communication fails in this area, it causes tasks to be done improperly or not at all.
  • Giving feedback to people who report to you so they can do their jobs better. Giving great, actionable feedback is a key skill for anyone in a leadership position. Non-verbal communication and body language also play a role here.
  • Problem-solving and decision-making meetings and discussions. These are considered among the most important discussions for any organization. This involves higher critical thinking and better communication technology.
  • Public relations can even be considered a form of external communication. Public perception is an essential aspect of a business communication strategy. 

How is it different from business communication services?

Business communication typically refers to the act of communicating in your business. On the other hand, business communication services refer to the types of software solutions you could use to help facilitate communication and collaboration across your business. 

Business communication services include: 

  • Voice solutions like VoIP
  • Software that allows you to conduct video meetings
  • Email services
  • Contact center software that manages communication with your customers
  • Small business VoIP that let you take calls and communicate from anywhere 

Which Business Communication Services Does My Business Need?

The answer largely depends on the size and preferences of your business. There’s no one-size-fits-all solution. One thing is for sure: you will set yourself up for success by only using the business communication services you need and will actually use.

For example:

You want a forum board, so you and your staff spend weeks finding the best solution and setting it up. After a while, you learn that no one is using it because they get their answers quicker from their team or documents. An unnecessary solution has cost you valuable time and money. Or you install a quality video conferencing system, when in reality you only need a reliable business phone system to run your remote meetings. Every business will use web-based communication. All the other methods, however, will depend on individual company circumstances. Take the time to mindfully consider the value of each for your unique situation.

Clear and effective business communication is critical for teams, employees, managers, and executives to perform their jobs and fulfill their responsibilities . Without the right processes and tools in place, the flow of information is interrupted and people are left in the dark. This can lead to serious consequences for the company, from unsatisfied employees and customers to lost profits. The transparent flow of information is an obvious overarching goal of a business communication process. But what are some deeper problems that successful business communication solves?

1) Email overload and lack of everyday productivity and clarity

In many workplaces, people are simply overwhelmed by the number of messages they receive in a single day. In his book Message Not Received , Phil Simon said the average person receives 120 to 150 emails per day. We easily misplace or completely overlook a crucial piece of information. With a business communication system in place, companies can reduce digital distractions and create space for ideas and thinking.

2) Horizontal and vertical communication silos

Oftentimes, teams and departments don’t exchange essential information. Other times, there’s no easy way of reaching out to a department manager when there’s an issue inside a team. These silos form easily and often without anyone noticing but can easily be remedied with a communication plan in place.

3) Poor communication with remote employees

Remote work is here to stay. The State of Remote Work report from Buffer shows that the vast majority of employees would like to work remotely for at least some of the time. They list collaboration and communication among the top three struggles when it comes to working remotely, proving the value of the right communication systems in place. Related: Telecommuting Technology: The Essentials for Remote Work

4) Employee turnover/Low employee engagement

Losing the ideal people from your organization puts your ability to serve customers at risk. It’s also expensive. Losing an employee can cost as much as twice their annual salary , but when companies communicate effectively, they are 50% more likely to report turnover levels below the industry average.

5) Poor customer service

If there’s poor communication in an organization, two things happen when it comes to customer service . First, employees in customer-facing roles won’t have the information they need. Second, customers will sense low employee morale and have a negative experience. In fact, one study found that employee attitude improvement impacts customer satisfaction, which then results in an increase in revenue.

What is the importance of non-verbal communication in business? 

Non-verbal communication covers so much ground – from your facial expressions to your tone in an email. Considering the vast majority of business communication happens asynchronously (meaning anything other than a 1-1, face-to-face meeting) via email, project management task boards, or chats…almost all of our business communication can be considered non-verbal. Therefore, it’s incredibly important to work on your verbal communication as well. 

Top tip? Read something out loud before you hit “send.” This is a good gut check to hear how your message is coming across. 

5 Steps to Set Up Your Business Communication Process

Business Internal Communication Graph

A solid business communication process is essential for the happiness of your employees and customers. Ultimately, this leads to financial stability. One report discovered 29% of employees believe their current internal comms tools aren’t working. Here are some of the reasons they listed: Irrelevant information, exclusion, dishonesty, and lack of access to key information is something your own workforce likely experienced, too. A study by Salesforce found that 86% of executives, employees, and educators consider inefficient communication to be the reason behind workplace failures. We can no longer ignore the importance of teamwork and chemistry and their impact on employee productivity, engagement, and advocacy.

5 steps to set up your business communication process - audit your current status & set goals,

Here are the steps you can follow to ensure a successful business communication process.

1) Audit your current state of business communication and set goals

No matter the stage of your business, you need a business communication plan in place. However, you will make it the most useful if you focus on the areas that need the biggest improvement right now and work your way to all other areas later on. For example, these might be some of the reasons your communication needs revisiting:

  • Low employee satisfaction or high turnover
  • Lower than expected outputs across the company
  • Fast growth, which leads to losing track of information
  • Lack of information transparency due to remote work

You might experience more than one of these or a completely different scenario. Identify it and set goals for your business communication process based on it. For example, your goals can include:

  • A specific employee turnover or satisfaction rate
  • Customer satisfaction rate
  • Number of projects completed
  • Number of interactions between departments

…and more.

2) Identify core groups in your organization and their relationships with each other

Look into the structure of your organization and all the groups involved in its ability to function. Take note of every group that requires information to function. This should include:

  • Horizontal classification , i.e., departments (operations, marketing, design, human resources, sales, customer support, finance, and more)
  • Vertical classification : professionals in teams, team leaders, department managers, executives
  • External groups : customers, suppliers, partners, and more

From here, considering the work they do on an ongoing basis and the results expected of them. Map out the way they need to communicate in order for their jobs to get done. Depending on your company size, this might be a large task, so give yourself plenty of time. Some of the main questions to answer are:

  • Which teams and people have to talk to whom on a daily basis? What about weekly, biweekly, and monthly?
  • What communication happens only when there’s an ongoing crisis ?
  • How are managers and team leaders maintaining progress in their departments? How does reporting work?
  • Is there a knowledge library that has the potential to reduce unnecessary meetings and conversations?
  • Which projects and processes need approvals from other people in the company? How are approvals requested and facilitated?

At a minimum, these answers should give you an insight into the necessary amount of emails, messages, calls, meetings, and documents for everything to happen in the designated time frame.

3) Define methods of communication

Next, choose the methods of communication that align with your business communication goals, as well as the interactions between core groups in your company. Review the list of methods of communication we discussed earlier and make sure to add any unique to your company:

  • Web-based communication
  • Telephone meetings
  • Video conferencing
  • Face-to-face meetings
  • Reports and official documents
  • Presentations
  • Forum boards and FAQs
  • Customer management activities

Which of these are essential for your organization to reach its goals? What’s optional and might see resistance in adoption? Which ones create the risk of adding too many tools and should be simplified? Be realistic about your specific needs. For example, a five-person startup where everyone works in the same office will likely focus on:

  • Customer management

A 50-person company that is fully remote will invest more resources into:

  • Phone and video conferencing
  • Document organization to be able to diligently track their processes

A large global enterprise will probably use all of the listed methods of communication and have dedicated teams for many of them.

4) Choose the right tools

There’s no handbook that defines which tools are absolutely best for each purpose. Gmail versus Outlook. Google Drive versus Dropbox. Slack versus Nextiva Chat. The battles go on, but your choice is entirely up to the preference of you and your workforce. While we can’t give you a list of software tools and leave you be, we can share these tips when it comes to selecting the right tools:

  • Use cloud storage to preserve important documents and other data. Enable automatic sync and backup to avoid human error and forgetting to manually save information to it.
  • Use a single platform for emails and calendars.
  • Use a single tool for chat messaging. For example, if some people use Slack and others Hangouts in their Gmail, it will create friction and impede communication.
  • Implement an easy-to-use, reliable VoIP phone system if many of your meetings happen remotely.
  • Develop brand and editorial guidelines that detail the tone of voice and use of brand elements. This way, all communication is unified, internally and externally.

5) Document the process

Finally, take note of everything you do throughout this setup and turn in into a shared document visible to the entire organization. This way, each employee can refer to an intentionally developed communication plan and decide on the best action for the situation they’re in. The document will also help newly on-boarded employees easily grasp all the tools and best communication practices. You can create a recurring calendar reminder for yourself and your team to revisit the document once a quarter. This way, you will ensure the plan is still serving its best purpose and update it if necessary.

Business Communication Channels

When business communication actually happens, it’s either verbal or written.

Communication takes place either in many forms – verbal or written, in-person or remotely, but it is critical to the happiness of your employees in the workplace.

business to business problem solving

Neither of these are better or worse for your company on their own and entirely depends on the context.

Written communication is great for keeping a paper trail of decisions and actions made as well as for putting together strategies and plans in place. Verbal interactions enable instantaneous idea generation and a more open flow of thoughts.

These are the methods of business communication applicable to some or all of the above scenarios:

1) Web-based communication

This includes everyday communication channels like emails and instant messaging applications (such as Slack, Hangouts, or even Nextiva Chat).

The benefits of emails and messages lie in the ability to lead private conversations in a busy office environment, as well as sharing a message with many people—from a few to hundreds—all at once.

2) Telephone meetings

Phones removed the location barrier to running productive, fast-moving meetings. It allows for better idea exchange thanks to the non-verbal communication (tone of voice) compared to written communication. Cloud phone systems can accelerate onboarding and overall team collaboration.

3) Video conferencing

Great video conferencing systems enable people at remote locations to run meetings that feel as close to in-person meetings as possible. They take phone meetings one step up.

4) Face-to-face meetings

In-person meetings can help a business move forward with ideas quickly. Research shows that in-person meetings generate more ideas than virtual meetings.

Customer Service Examples

Related Article

The 10 Best Customer Service Examples

However, having a rock-solid meeting agenda is essential for effective meetings. 46% of employees rarely or never leave a meeting knowing what they’re supposed to do next.

5) Reports and official documents

Documenting activities that impact other people and departments is a crucial part of a well-oiled business communication system. The ability to refer to a written document at any moment reduces the chance for confusion or disagreement and provides extra clarity in communication.

6) Presentations

Presentations supported by reports and PowerPoint slide decks are often how meetings with larger groups are conducted.

These are great for sharing new ideas in a way that creates space for questions and any clarifications.

7) Forum boards and FAQs

An internal area for employees to refer to frequently asked questions on various departmental topics and to ask new ones that will make them more productive and up-to-date on a matter.

Both internal and customer surveys are ideal ways to gather feedback and ratings on important topics. Surveys facilitate a healthy cycle of feedback-supported improvements and open a communication channel between all levels inside an organization.

9) Customer management activities

This can include any customer relations activity. Examples include live chat support, customer relationship management (CRM) systems, customer onboarding processes, customer reviews , and more.

satisfied customer giving a thumbs up

60+ Customer Satisfaction Survey Questions You Can Borrow

Your company success starts with communication.

Poor communication carries too many risks to an organization to count.

Great communication, however, brings an opportunity for outstanding employee and customer engagement. It creates clarity, more significant outputs, and growth in revenue and profit.

Helpful Guide: What Is a VoIP Phone & How Does It Work?

Whether you have a business communication system in place or are yet to establish one, remember to:

  • Set and revisit your communication goals as a company based on the current state of communication in your company
  • Identify everyone involved in processes that make your company do its job, day after day
  • Analyze their needs to communicate with each other and identify methods that make the information flow possible
  • Look for the most appropriate tools and platforms that will enable the methods you identified
  • Share this setup transparently with the whole organization

As a result, you’ll see happy, productive people excited to work on projects and create meaningful results for the benefit of everyone involved.

Ready to improve your business communication? 

Nextiva’s business communications platform organizes your team’s communication by bringing it all into a single platform. No more shuffling around to find what you need, no more frustration flipping between screens. It’s all here in a single platform. This tool makes your work life more simple and helps bring all your communication into one view. 

Talk to an expert today to see how we can help simplify your business communication. 

Elevate your business communications for free.

Get your business phone, messages, video meetings, contact management and notes–integrated in ONE powerful app. FREE.

Business communication is the process of sharing information between people within the workplace and outside a company. Effective business communication is how employees and management interact to reach organizational goals. Its purpose is to improve organizational practices and reduce errors. It’s important to work on both your communication skills and communication processes to achieve effective business communication. 


Nextiva is the future-of-work software company that helps sales, service, and marketing teams achieve higher productivity and deliver better customer engagement. Nextiva’s cloud-based platform brings together business communications applications, intelligence, and automation to help companies build deeper connections with customers and manage all conversations and relationships in one place.

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The Ground-Floor Window Into What’s Ailing Downtowns

City centers may have to be reimagined to solve the problem of vacant storefronts.

Emily Badger

By Emily Badger

Emily Badger covers cities and urban policy for The Times. She spent much of her summer photographing vacant storefronts while walking around downtown San Francisco, Washington and Portland, Ore.

business to business problem solving

Downtown San Francisco’s office buildings have been quieted by some of the highest vacancy rates and slowest return-to-office trends in the country. But when walking around the area, what makes it feel still so uninhabited is a different but related phenomenon downstairs from all those empty offices: the vacant ground floor.

It’s the windows with their shades tightly drawn, the phantom deli counters visible through dusty glass, the lingering signage for a Verizon store that doesn’t exist anymore. It’s the glum handwritten notes — “this location is closed” — and the brokerage signs trying to be cheery. Around nearly every corner, they’re seeking someone to lease 822 square feet of former coffee shop, or 5,446 square feet of empty bakery, or 12,632 square feet of what was once a Walgreens.

Like much of the office space above it , the ground floor will probably have to be reimagined in San Francisco’s business district and other downtowns that have long taken for granted a captive audience of commuting consumers. In fact, it will be hard to solve the problem upstairs without also solving this one. Because who wants to return downtown when its most visible spaces have been darkened, boarded up and papered over?

“There’s nothing worse than the butcher paper,” said Conrad Kickert, an urban design scholar at the University at Buffalo who studies storefronts and street life. “And only one step above that are these sad stickers with happy smiling people on them.”

business to business problem solving

These scenes have such an effect on us, Mr. Kickert said, because the vast majority of our interaction with architecture and buildings happens at the ground floor. It’s where we form our sense that a street is safe and vibrant, or that something doesn’t feel right. It’s where the city comes to life in its jumbled diversity: the cocktail lounge next to the dry cleaner next to the ramen shop, but also the financier next to the tourist next to the retail clerk.

The ground floor, ideally, is where we can be seen, and see so much.

“What do people like? They like to look at other people,” said David Baker, a San Francisco architect, citing a popular creed among architects and planners. “People sitting in there eating a burrito are much more interesting than even a good piece of art.”

A related truism: Walking down the street, you never see the empty cubicles on the 18th floor. But you can’t miss the closed burrito shop.

business to business problem solving

Filling so much empty ground-floor space may require cities to rethink what brings people downtown. It may force officials to change how they regulate buildings, and property owners to shift how they profit from them.

“The ground-floor restaurant or ground-floor coffee shop or bar should not be seen as the moneymaker for an office high-rise, but as a benefit to the community to serve anyone that comes downtown,” said Robbie Silver, head of the Downtown San Francisco Partnership . “That mind-set has not really happened yet.”

To the contrary, property owners may find a tax benefit in writing off vacant retail space. And they may be wary of lowering rents to fill those spaces, for fear of admitting to investors that a building’s profitability has declined.

Vacancies operate like a virus, though, Mr. Silver said. Each one makes it harder for surrounding businesses to stay afloat. And then empty streets undermine the sense of public safety, further driving pedestrians and retailers away.

In his district, 43 square blocks primarily covering San Francisco’s traditional financial district, Mr. Silver’s staff went door-to-door earlier this year and counted about 150,000 square feet of vacant retail. That’s a small part of the area’s 32 million total square feet of real estate. But it’s about a third of all the ground-floor commercial space.

business to business problem solving

In San Francisco and nationwide, traditional retail was struggling even before the pandemic with the rise of e-commerce. Many cities had also overbuilt ground-floor commercial space.

“You just can’t have healthy retail every inch of every corner of every city,” said Laura Barr, who leads the retail tenant and investor leasing business for CBRE, based in San Francisco.

Cities’ enthusiasm for retail had grown out of the perfectly reasonable idea that mixed-use buildings — commercial below, offices or housing above — have many benefits. They enable people to live and work above the things they need to buy. They can reduce all the driving that’s necessary when stores aren’t near homes or workplaces. And they can foster livelier streets than blank facades or parking garages do.

“I was one of those people running around the country saying ‘mixed use!’” said Ilana Preuss, whose consulting firm helps cities revitalize their downtowns. “The problem was we said ‘mixed use’ everywhere. And we spread it like peanut butter.”

That (and malls) helped give America more retail per capita than any other country . In retrospect, Ms. Preuss said, advocates and planners didn’t think enough about where they wanted people to actually gather. And while they thought about mixing uses vertically (an office on top of a restaurant), they didn’t consider it horizontally — a restaurant side-by-side at street level with office spaces, apartments and even modest manufacturing.

business to business problem solving

To fill vacant downtown storefronts now, cities will have to consider other such uses. Perhaps fewer coffee shops, and more health clinics, day care centers, university classrooms, live/work spaces and fabrication shops. Ms. Preuss today proposes filling vacant spaces with small-scale manufacturing that has the added benefits of paying more than retail and relying less on foot traffic. She doesn’t mean noisy factories, but people producing tangible things, like bottling hot sauce or roasting coffee beans.

Or maybe the empty storefront becomes something else entirely.

“What if there were just more public bathrooms?” said Kim Sandara, an artist living in New York. Or spaces for free cultural programming or city services, or artist studio space.

Some of Ms. Sandara’s art is on display in downtown Washington, concealing vacant storefronts. The business improvement district there asked artists early in the pandemic to submit pieces that could be reproduced over empty windows . One of Ms. Sandara’s pieces, “ Chelsea’s Painting ,” covers an empty noodle shop in abstract, vibrant blues and oranges.

business to business problem solving

“The first time I saw it in person, I felt such a grand joy,” Ms. Sandara said (a joyful painting is perhaps the highest form of the empty-storefront genre, well above the butcher paper and the faux-coffee-shop sticker). But of course the sight is bittersweet. “It feels very much like how the pandemic has felt since it started,” Ms. Sandara said. “We’re trying to find solutions that are hopeful, but the structure of things still needs work.”

For some of these alternative ideas to even be viable, cities would have to allow other uses where currently they require retail. They might have to give incentives to building owners, who typically prefer one 10,000-square-foot tenant on the ground floor over five small businesses dividing the same space. And building owners, as Mr. Silver suggested, may have to change how they view their economics.

Oliver Carr, a longtime Washington-based developer , said he no longer counts on turning a profit on the ground floor. He now views it primarily as adding value to the floors upstairs. A restaurant is worth keeping even at a loss, in other words, if it helps fill the offices above, or even boosts the rents there.

“Don’t get me wrong — if we can generate rent and profit on retail, we want to do that,” Mr. Carr said. “I’m just saying we’re typically not expecting it.”

business to business problem solving

Reimagining the ground floor would also require developers to treat it as more than an afterthought, or not just what can fit into the leftover space once the lobby, elevators, mechanical rooms and structural beams have gone in, said Jodie McLean.

“If we do the first 20 feet right, it will drive all the value upstairs,” said Ms. McLean, the chief executive officer of EDENS , which develops open-air retail and mixed-use projects that emphasize the ground floor.

There are signs that cities are starting to experiment, pairing vacant storefronts with pop-up galleries and businesses , courting college campuses , creating new grants and tax credits . Fundamentally, Mr. Kickert said, cities need to see the street level as less a place of transaction, and more one of interaction. And perhaps the people interacting aren’t buying anything at all.

That idea suits Ms. Sandara, whose art will hopefully come down one day, replaced by people inside, doing something. Just what goes into the space next will affect how bittersweet that moment feels, too.

“If it’s something that’s for the community,” Ms. Sandara said, “I’ll feel very happy that its era has ended and it’s served what it was supposed to serve.”

And if “Chelsea’s Painting” is replaced by, say, a Starbucks?

“It’ll just feel like, well, I had my time, I showed my work, some people experienced it. That’s nice.”

Emily Badger writes about cities and urban policy for The Upshot from the Washington bureau. She's particularly interested in housing, transportation and inequality — and how they’re all connected. She joined The Times in 2016 from The Washington Post. More about Emily Badger

From The Upshot: What the Data Says

Analysis that explains politics, policy and everyday life..

Health Care Costs:  Instead of growing and growing, spending per Medicare beneficiary, a notorious budget buster, has nearly leveled off over more than a decade . No one is sure why.

The Limits of Human Perfection : Why do athletes seem to get better with every new generation? It’s not always for the reasons you might think. Professional darts provides a useful study .

Remote Workers: During the Covid pandemic, people who worked from home became significantly more likely to move — and more likely to do so than all other workers .

A New Brain Drain? : Major coastal cities priced out low-wage workers. Now college graduates are leaving, too .

Pregnancies: Births and pregnancies in the United States have been on a long-term decline. New data analysis provides one reason: It’s becoming less common for women to get pregnant when they don’t want to be .

Dialect Quiz:  What does the way you speak say about where you’re from? Answer these questions to find out .


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