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Tool Box Talks: 5 whys

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Management tools are a dime a dozen. And yet, contrary to popular belief, most of them are good and helpful if used correctly and in an adequately defined context.
In “Tool Box Talks” we introduce you to common and less well-known tools and show you how you can exploit their potential for your enterprise, with today’s focus on 5 why.

What is 5 whys and when should it be used?

5 whys is a quality management tool developed by Toyoda Sakichi. It helps to reveal causal links and to understand complex cause-and-effect relationships. This method is mostly used in root-cause analyses in the context of failure analyses or optimising processes. Apart from this, it is suitable for any kind of cause-and-effect relationship, particularly for linear ones with no or only few ramifications.

How is 5 whys used?

The starting point of a 5 why analysis is an observed deviation from the norm, i.e. the “effect”. This is where the first “Why?” is asked: “Why has the problem occurred?”
The answer to this question is the cause of the observed effect. This cause can again be understood as another effect of another cause, which is explored by means of a second “Why?”. This process is repeated five times until the cause of the cause of the cause of the cause of the observed deviation is discovered and its origin – its root cause – is detected.

Beware of pitfall

Make sure that, when using the 5 whys technique, that you do not only identify a possible cause-and-effect relationship, but also verify it, in a way that each of the “Why?” questions undergoes a process of examination checking if

  1. the shown causal link is possisble and plausible, and
  2. if under the present conditions the alleged cause is really responsible for the effect

Only if both requirements are fulfilled, the next “Why?” should be asked.
Besides, do not be a stickler with the number “5”. As a rule of thumb it is usually appropriate to ask for the cause five times to identify the actual source of a problem; still, you should check individually and flexibly if a sixth of seventh level might give you valuable information after all, or if you can end the process after the fourth question.

What is the use of the 5 why method?

A 5 why analysis brings to light the details of the cause-and-effect chain having led to the (mostly undesired) incident. This will help you to prevent this problem from occurring again.

Here a distinction is made between corrective and preventive measures. The latter are applied in the upper layer of the causal chain, thus addressing one specific issue, whereas preventive measures are used in the deeper levels of the cause-and-effect relationship – tackling the root cause. They usually have a greater, further-reaching impact, also making it possible to avoid other negative results originating from the same weakness.

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Optimising Processes with External Partners

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Especially in smaller companies, processes tend to become closely linked to those employees who are responsible for their execution. Over time, these employees have created their workflows according to their needs. The tasks along the process fit seamlessly into the daily workload, they exactly know what to do and the results are fine.

But when these employees quit their job, the new process owner faces the challenge to manage a grown and often not well documented process. Keeping the process functional is a tough task, and if external partners are involved in the workflow, complexity raises exponentially.

In such a situation, three steps help to ensure continuity and support optimisation of the process passed on to the new process owner.

1. Understand the Current Process Setup

First, the new process owner should understand how the process is actually working. In this step it is helpful to visualise the flow of information and products with the support of all internal partners, e.g. in a value chain analysis.

It is helpful to include the former process owner in such an exercise as he has both the relevant process knowledge and the necessary experience. However, to avoid conflict, focus on recording the status quo and do not question the way things are as this will be taken as criticism by your predecessor. Rather, ask questions on how the process actually works and how the former process owner has contributed to its success. In this way you will pay tribute to the leaving employee and get an accurate picture of the process.

2. Internal Process Optimisation

While you avoided questioning the status quo in the beginning, you should do exactly that in the next step, of course without the former process owner. The internal process optimisation is a task for the new process owner and should be supported by all internal process partners.

The optimisation should follow the procedure described in How to optimise internal business processes: Set the objectives, get to know the status quo (see Step 1), choose a suitable method, get the optimisation project done and integrate the improvements into existing structures. Besides, common pitfalls which unneccisarily slow down the process should be removed (see Three factors that slow down business processes)

3. Optimise External Interfaces

Finally, the interfaces with external partners should be improved. This step should be done as early as possible to avoid issues at the interfaces in the transition from the old to the new process owner. However, the internal processes should already be re-aligned before reaching out to externals.

The optimisation of external interfaces is best done in a workshop – either face-to-face or virtually. Within the workshop, a shared process understanding is established, interfaces are analysed, and weak spots are identified. An external facilitator with an unbiased view may support the process and mediate between partners if necessary.

It is important to create a positive atmosphere for the workshop where people feel appreciated to enable open and constructive feedback from all participants. Group dynamics need to be cared for from the beginning to avoid conflicts between individuals or groups. Here, different tools like a group exercise may be used to relax the atmosphere and create awareness for potential issues. Working with breakout groups, for example, allows for deep dives on selected interfaces.

The output of the external process optimisation should be an action list including all measures defined by all internal and external partners. Once implemented, these measures will help the partners involved in the process to contribute more efficiently and effectively to the process.

If you wish to know more about or need support with improving processes in a transition from one process owner to another, please get in touch with us and learn how we may support you.

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Three factors that slow down business processes

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In the past few months your company spent a lot of time and effort into optimising their internal processes. Jobs and the separate process steps were scanned closely for potential weaknesses, and improved where possible. In the end all identified weak spots were addressed – and yet, the actual lead time was way behind the set target.

We have already described options for process optimization and continuous improvement in previous releases and know that if individual process steps are analysed and enhanced, the overall processes can be accelerated considerably. But often the real reasons why they are too slow go unnoticed as they are hidden in the interfaces between process steps.

Factor 1: Loops

In most cases delay is caused by the necessity to do rework whenever you have to loop back to a previous process step already completed. Just as there are different root causes for such rework, there are different approaches to identify and remove it.

Whenever rework is necessary to correct a mistake, this creates an unnecessary process loop. Process analysis, statistical data about errors or faulty products are useful tools to find out what flaws trigger the loop. The best way to address this problem is, obviously, to improve the workflow in a way that it runs smoothly. Alternatively, recognising errors as soon as possible minimises the waste of time due to rework.

Often, particularly in administrative processes, loops are the result of missing bits of information. Any query about earlier stages of a process costs time, especially so if the person responsible for the issue is not available. A systematic record of queries or direct interviews with relevant process participants can help identify possible weaknesses. Once the problem has been pinpointed, the interfaces between the respective process steps have to be adjusted I a way that all relevant information is being passed on, thus making further inquiries unnecessary.

Factor 2: Missing input

Just as loops caused by further inquiries waste time, so does information not gathered in time slow down business processes. The timing of when this specific input is being provided is particularly relevant in complex processes with two (or more) sub-processes.

In principle, there are two approaches to remedy such problems concerning interfaces. One straightforward fix is a Kanban system, so that the entire and complete input necessary for a certain process step is available when needed. Whenever the flow of goods and information has to be actively regulated, this method should be chosen. If, however, active input management is difficult to realise, it is advisable to work with a check list. In this way you can make sure in advance if all necessary input parameters are at hand before you start a process.

Factor 3: Idle time

In most cases it is idle time in the form of waiting that slows down processes. Whenever you do not directly move on to the next process step but keep your goods or data on hold, you are stuck in idle time.
To identify such periods of unproductive waiting, you have to scan critically the flow of goods and data within a process. Once you have found in the process chain the bottlenecks responsible for regularly creating idle time lost with waiting, you need to adjust the respective interfaces, either by a Kanban system or by implementing an early warning system preparing for the next process step.

As has been shown in these three instances slackening the processing pace, the process lead time is not only determined by single process steps, but, to a considerable degree, by their different interfaces and the flow of goods and information. This means that, in terms of process optimisation, these issues should be examined just as closely as the process activities themselves.

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Quick fix – or rather a sustainable solution?

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The production lines operate at maximum capacity, order books are full, and the next delivery date is at hand. The last batch is just leaving the coating line when the red light flashes: there are uncoated spots clearly visible on several parts.
Happily, this is not a major issue. The affected parts are stripped, cleaned and sent back to the coating line. Half a day later, the lot is ready for shipment.

Quick fix versus sustainable solution

You probably know similar situations, not only from a production context, but also from other parts of an organisation. A deviation is observed and almost instantaneously someone puts forth a solution – and often this solution remedies the deviation.
Unfortunately, most of these solutions are mere quick fixes, which only address the symptoms. They correct the observed deviation but not the underlying problem which caused the deviation in the first place. Thus the deviation is likely to re-occur later.
In contrast, a sustainable solution does not address the symptoms but the root cause. To address the cause generally requires a bit more time and effort compared to a quick fix. However, it also prevents the same mistake from happening again.

Reasons for a deviation

A deviation in this context means that the actual result does not line up with the expected result. This may happen due to two reasons: either the assumptions on which expectations are based are incorrect or there are flaws in the implementation.

Incorrect assumptions

If you are implementing something new, deviations are often caused by incorrect assumptions. Whether it comes to product development, process optimisation, or the implementation of new tools or methods – you always step out of your experience and explore a new terrain.
In a new environment with only partial information, expectations are mostly based on assumptions, either about the environment, functionalities or causal links. It is important to be aware of these assumptions.

Implementation flaws

If the expected results are not based on assumptions but are derived from a sound understanding of how various factors are correlated and interconnected, deviations often result from flaws in the implementation. It is well-known how to achieve the targeted results, but once or twice this best practice approach was abandoned.
This type of deviation is often observed in areas with clear and stable processes in place like large series production or other frequently repeated processes with low variance.

How to address deviations with long-term success?

If you want to get rid of a deviation once and for all, you should follow a three-step approach:

Analyse the deviation

First of all, you need to understand the type of deviation you are dealing with. Ask yourself whether your expectations are based on an extensive process knowledge or on mere assumptions. If the latter is the case, try to understand which assumptions you have made.

Analyse the root cause

Next, you need to understand the root cause of the deviation. You need to understand which assumptions were incorrect or where the way you implemented certain steps had flaws. Tools like 5-why or Ishikawa are quite useful.

Derive and implement measures

Once you understand the root cause you need to address it. If the cause is a flaw in the implementation, you need to ask: How can I prevent the process from slipping again? The answer usually is to be found in the design of the process or the control mechanism. In this article, we have summarized how you can optimize internal processes.
In the case of incorrect assumptions, you first of all need to replace faulty assumption. Afterwards, you need to assess how, based on your updated knowledge, you ought to proceed.

If you adhere to this procedure and keep in mind our recommendations for optimising processes, you can not only correct deviations and errors, but also fix them sustainably and thus achieve real quality and process improvement. Contact us and we will find a tailored solution for your needs.

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How continuous improvement may succeed

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On hearing “continuous improvement”, many people thing of the Deming circle or PDCA: plan an improvement, implement it (do), check the results and act upon the them. Once the cycle is completed, it starts anew and thus realises continuous improvement. The second thought, however, may probably be something like “But it’s not that easy!” or “The theory is fine – but it never works that way in real life!” – and considering all the failed initiatives to implement continuous improvement, these thoughts are understandable.

Nevertheless, PDCA is an effective tool to implement continuous improvement. As in many cases, the problem is that this instrument is applied in the wrong way: surveying failed process improvement projects, one comes to the conclusion that mostly the use of tools is responsible for their failure – and not the tools themselves.

Process optimisation as cause-and-effect chain

Process optimisation along the lines of PDCA basically follows the logic of a cause-and-effect chain. An existing process is deliberately modified (= cause) and as a result the efficiency or effectiveness of the process improves (= effect). This sounds trivial but, far from it, actually significantly impacts the approach to process optimisation.

Causal relationship between cause and effect

If process optimisation follows the logic of cause-and-effect chains, then there is a causal relationship between cause and effect. This relationship is created by the process which is to be improved and the interfaces with other processes.

Generally, these causal relationships are not just linear dependencies but form complex networks. These networks are normally not limited to the process to be improved but linked to other processes and activities by interfaces.

Explicability of the effect

Another consequence of process improvement as a cause-and-effect chain is that you can explain the effect of any process modification. Causal relationship provides a rational explanation why a certain effect results from a given cause.

The rational explanation may be used in two ways. If the causal network is known, the effect of any modification can be predicted. Likewise, if both cause and effect are known, the causal network can be reconstructed.

Optimising causal networks based on PDCA

Given the implications of process optimization as a cause-and-effect chain, PDCA is ideal for continuous improvement. In this context, the respective steps are:

Start

Before first applying PDCA, the optimization target needs to be defined (see „How to optimise internal business processes“ [Link: https://rno-consulting.com/en/how-to-optimise-internal-business-processes/]). The target should be clearly defined and quantified whenever possible.

Plan

Based on the current understanding of the process, i.e. its causal network, an optimisation step is worked out which modifies to process depending on the defined target. Having done so, both the necessary measure (= cause) and the expected outcome (= effect) have to be described.

Do

The described step is implemented, with a constant monitoring of the resulting effects on the process.

Check

Once the optimisation step is implemented, the actual effects are compared with the expected ones. If the observed results match those expected in the plan-step, the PDCA iteration is completed. In case the overall target is met, the optimisation cycle is completed, otherwise another iteration begins (i.e. plan).

If the observed results were not expected, the current process knowledge needs to be adjusted. To allow for such an adjustment, it is essential to understand why the implemented change resulted in the observed effect.

Act

Once the causal relationship between the implemented measure and the observed effect is established, the knowledge about the process needs to be updated accordingly. The updated knowledge will then serve as a basis for another PDCA iteration.

Benefits from PDCA process optimisation

Using PDCA for process optimisation requires thorough application, which may prove difficult in busy day-to-day operations. Most of all, the analysis of unexpected effects is readily skipped in favour of quickly implemented fixes.

However, by sticking to the steps described above, you will win twice: First, you will achieve the set targets for process improvements. Second, your knowledge about relevant processes will increase.

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How to optimise internal business processes

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Internal business processes often cost a lot of time and money, as it is the efficiency of industrial processes that determines how much time and money is needed on all levels of a company, from manufacturing to business management. Thus optimising internal business processes has a direct impact on the performance and financial success of companies.

The concept of process optimisation

Process optimisation is nothing new. Ever since James P. Womack’s bestseller “The Machine that Changed the World” from the early nineties, Lean and other approaches to process optimisation have become common management practice. When you submit the keyword “process optimization” at Amazon, you are offered hundreds of books on this very subject.

Considering the vast offer of methods, tools and implementation assistance, today’s industrial processes should be perfect. There should be no waste of resources. It should be natural – and no longer be a competitive advantage – to have optimised processes however complex they be.

However, even almost 30 years after Lean & Co found their way into business, reality still looks different: People responsible for shaping internal processes act according to the motto “We’ve always done it like that”; in spite of changing environment, no adjustments are made to internal processes; things that go wrong are addressed only superficially rather than being used as a starting point for a thorough revamp; and attempts at initialising process optimisation regularly come to nothing. Instead of just patching up bugs with a quick fix, you should focus on sustainable solutions.

5 Steps to Successful Process Optimisation

If you want to make sure that processes within your company run smoothly, without waste of resources and that your next process optimisation leads to a sustainable increase in productivity, you should follow these five steps:

1. Set your objectives accurately

Before starting to optimise internal processes, you should define what exactly it is you would like to improve: Are you concerned about reducing costs, enhancing quality or speeding up response mechanisms? Or are you going after something more complex, like, for instance, customer satisfaction or staff loyalty?

Besides defining the objectives, you should also consider how to measure success. This includes the data to be recorded, the timing of the data recording and any calculation required to evaluate progress.

2. Get to know the status quo

Having defined your objectives and targets, you should familiarise yourself with the current state of affairs within your enterprise. Knowing the status quo will help you identify weaknesses, outline the need for improvement to those involved and carving out starting points for process optimisation.

Furthermore, the analysis of the present state of affairs will help you to check how useful the criteria are which you have chosen for assessing success. At the same time, you build up a coherent frame of reference for your improvements, so that you can measure quantitatively how effective your methods are.

3. Choose a suitable method

The third step is about choosing a method suitable for the set target. Even if various industry pundits suggest something different – there is no one and only path to follow. Therefore, you have to find out yourself which of the available methods is most likely to lead you to success.

In case you should not have the necessary know-how in terms of proper methods and tools, or if you lack orientation in the jungle of approaches and strategies at hand and feel unfit to make a wise and informed choice, you can rely on the assistance of experienced management consultants. In this way you will prevent yourself from missing your targets just because you used inappropriate methods, hence safeguarding your economic success.

4. Get your optimisation project going and done

The next step is simply put: You have to put your project of optimising internal processes into practice. It goes without saying that this should be done comprehensively and with meticulous care, for otherwise the set targets cannot be fulfilled.

During the process of optimisation you should keep an eye on the measurements you have chosen to assess your progress. This will help you see at an early stage if the measures taken have the desired effect or if you might have to modify them.

5. Integrate your improvements into existing structures

Now only one last step is missing, which, however, is often overlooked although it is vital: Processes carried out by humans have a tendency to fall back into old, deeply ingrained habits. To avoid this, you have to make sure the new processes are firmly anchored, i.e. you need to create mechanisms to prevent this regression.

If you keep these five steps in mind when optimising internal business processes, you will truly improve the efficiency and financial success of your company and secure its long-term success.
In this article we present another approach to continuous improvement. If you want to learn which approach best suits your company’s needs, please contact us for a free initial discussion.

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