Situation and Define the Problem

Table of Contents

Carefully Aim Before Firing

In Toyota’s internal Toyota Way 2001 document they describe problem solving under the broad category genchi genbutsu—the actual part, the actual place. The discipline of carefully observing actual processes directly without preconception—with a blank mind—starts the process of truly understanding the problem. This leads to a thorough explanation of what is happening and its effect on the area, the team, the customer, or the company and reveals why the problem deserves attention.

The first requirement of problem solving is to determine the merit of solving the problem. At this stage, all problems can be weighed side by side, and the most important are tackled first. Lesser problems may be assigned to small teams, such as Quality Circles, or even to individuals.

There’s a saying that mocks both American and Japanese styles of problem solving. The Americans say, “Ready, fire, aim,” while the Japanese say, “Ready, aim, aim, aim, fire.” There is an element of truth in both of these approaches, and an element of both strength and weakness in each.

Many companies in the United States are so focused and driven by short-term (quarterly) results that improvement activities are initiated before the situation is clearly understood. These actions are completed, and a new (90-day) plan is developed each quarter. This short-term “fire first and set the target later” approach leads to a “shotgun” effect, resulting in bits of improvement here and there. Often these random improvements are made to issues unrelated to the situation being addressed. Activities are completed, but the desired condition is not achieved, and because there was no defined reason for these activities, a long-term sustainment of “results” is virtually guaranteed to fail.


Avoid the mistake of putting too much effort and expense into solving insignificant problems. Carefully consider the importance and value of solving the problem prior to beginning activity. Do not exert one dollar’s worth of effort to solve a five-cent problem. If the problem is relatively minor in comparison to other problems, it can be addressed by the individual or team most affected by it, rather than by a large team or member of management.

In contrast, the Japanese (and Toyota) can be painstakingly meticulous in the initial phase of understanding the situation, which frustrates Americans who are ready to “get started.” This apparently belabored process is vital to a successful problem-solving activity for two reasons.

1.Careful consideration must be given to understanding the characteristics of the problem—by weighing the impact of the problem on customers, employees, and the company, and finally by deciding if the problem is important enough to dedicate valuable time and attention to solving. The inventor Charles Kettering said, “A problem well stated is a problem half solved.” Put another way, a large proportion of the problem-solving activity should be devoted to thoroughly understanding the problem situation, which leads to focusing on the problem rather than its symptoms.

2.Focusing energy and leveraging resources is critical to achieving a higher level of success with minimal effort. This starts with reaching agreement with all affected parties on the need to pursue the issue.

Within Toyota, the question, “Why did you pick up this problem?” is often used. It means, “How did you determine that this problem deserves your time and attention?” And also, “Why did you choose this problem over the many other possible issues?” In addition, there is an implied request: “Please explain your reasoning so I can understand the situation, ensure that you’ve done adequate reflection, assure that we are in agreement and alignment on the issue— and so I can provide necessary support and guidelines for your process.” There are many things packed into that one simple question, issues that must be examined in order to develop a thorough understanding of the situation.

This rigorous questioning often leads to frustration for Americans, who tend to feel that it questions their ability to handle the situation on their own (an American characteristic), or that their evaluation was not complete. Within Toyota, many people meticulously review the process of understanding the situation, and feedback is always given. Often, after initial rounds of questions, additional rounds of questioning ensue. This is the “aim, aim, aim” phase. Valuable insights can be gained by this repetition, perhaps bringing new things to light through various reviewers, and in the long run much time can be saved by not chasing errant issues of lesser importance.

If your organization hasn’t had an effective process for making improvement, there will probably be numerous issues in the backlog. When the word “problem” is mentioned or people know that you want to improve processes and are interested in knowing what the problems are, two things will probably happen:

1.You’ll be deluged with many problems, ranging from broken water fountains and fans (which should be corrected without the need for long-term problem solving) to issues that occurred years ago.
2.As soon as any “problem” is mentioned, solutions will be proposed. Since the existence of a problem has not been confirmed, any proposal of solutions is premature and a waste of time (not focused or leveraged).

Initiating this process may be like opening Pandora’s box. After looking inside, you may wish you had kept the lid closed! It’s easy to be overwhelmed by the magnitude of opportunity for improvement available (and necessary) and the sheer numbers of problems that will surface.


You must be prepared to help people differentiate between issues that can and should be corrected in the short term without in-depth analysis and long-term endemic issues that affect the performance of the person, group, or company.


One of the signs of a “Ready, fire, aim” culture is the tendency to “jump” immediately from the “problem” to the “solution.” In many cases the problem may be mentioned casually and much time spent proposing various “solutions” before the “problem” has been clearly defined. At this stage in the process it is likely that a symptom has been observed rather than a true problem.

The following is a typical conversation that might occur, indicating the trap of jumping to solutions prematurely:

Manager: We have been having trouble with defects lately. (Note the vague “definition” of a “problem”.)

Employee 1: A lot of the damage is coming from handling. (Note the “root cause analysis”.)

Employee 2: Why don’t we get new carts? (Note the jump to a solution.)

Employee 1: Yeah, Joe had a design for one a while back. (Now the conversation gets way off track!)

Employee 3: Do you know what happened to it?

Employee 1: No, but I know he had one.

Employee 2: I saw it too, but I’m not sure what happened to it. I think he told the engineer, but nothing was ever done.

Manager: Would you ask Joe to find out about his design and see if he still has it? (Now valuable time will be wasted chasing a “solution” to an undefined problem.)

Employee: Yes, I should know something by next week’s meeting.

Problem solved! Or was it? What was the problem? “Defects” is a fairly broad issue. Why did the employee jump to the conclusion that “defects” were caused by handling? That may be his personal experience regarding “defects,” but it’s only one possibility. Do you see how the process was so easily sidetracked? The conversation went from a general statement about defects (not a well-defined problem), to a cause (handling), to a solution (Joe’s carts), to an action (follow up with Joe) in a matter of seconds. What will happen next? There will be follow-up with Joe, additional meetings when time is spent (wasted) debating why Joe’s solution was never used in the first place, and then debate about whether it was actually a good design and a different design is needed. Finally, a decision may be reached to build new carts, and they will be put in place. Do you think the “defect” problem will be resolved? The sad part is that this group is under the illusion that they’re actually getting “results,” and in fact they may somewhat improve the results. But it’s a case of focusing on the nickels (small causes) while the dollars (major causes) fly overhead.


To avoid premature discussion of solutions and to keep the process on track, record ideas for solutions with a statement such as: “Okay, that may be a possible solution and I don’t want to lose your idea, so I’ll write it down and we can discuss it later, when we’re investigating possible solutions. However, right now we want to stay focused on identifying the problem.”


It’s easy to confuse activity with results. A poorly defined problem and a rush to solution and action lead to activity without achieving the desired results. If you desire to maximize your return, a focused effort on a clearly defined problem followed by a thorough analysis will lead to significant results.

Find the True Problem to Get the Most Significant Results

When beginning the process of identifying the true problem, it’s a challenge to find the issue at the most significant level. Often a problem is perceived based on personal experience, but this may only be “a problem” rather than “the problem.” If we ask, “What is your main problem?” the answer is likely to be an issue that is most present and frequently experienced by the person being asked. For example, an operator who experiences a persistent problem every day will likely perceive it to be “the problem.” In addition, a person’s role in the organization tends to skew the importance of an issue for him or her. Those in the accounting department, for example, tend to see cost issues as the most important. Those in purchasing often believe that vendors are the primary concern, and engineers tend to focus on equipment-related issues.

Toyota refers to the Five-why process (explained later) as a “causal chain,” because the problems and their causes are linked together in a series of single and branched chains. In an attempt to identify “the problem,” people often enter the causal chain at the problem perception point, or the “point of recognition,” rather than at the level of the true problem. They have identified what they believe the problem to be, but they may be further down the causal chain rather than at the top, where the true problem resides. Finding the true problem is based on understanding its effect at the highest level, where the full impact of the issue is experienced.

When identifying any problem, Toyota views it in the context of the primary performance measures, which are safety, quality, productivity, and cost (Figure 14-1). These measures are inherently linked to one another, and it’s not possible to negatively impact one of the measures without also negatively influencing another. For example, if a defect affects quality performance, it may also affect

Figure 14-1. Relationship of primary performance measures

the ability to produce the desired quantity of product, thus causing customer service levels to suffer. To avoid affecting the customer, appropriate countermeasures such as increased inspection or production time may be employed to protect the customer. These extra measures will increase the cost. An operator who detects the defect may conclude that the defect is “the problem,” when in fact the true problem is the affect on customer service, and ultimately on the total cost.

The placement of the measures in this model does not imply importance. In other words, cost is not the most important measure. Customer satisfaction is the most important measure. We want to achieve the highest level of customer satisfaction while maintaining the lowest possible cost.

Delivering a quality product to the customer is always understood to be the number one goal. A tenet of the Toyota Way is that a defect should never knowingly be passed on to the next process. The effort to ensure the correction, containment, or control of the quality problem will have a negative impact on productivity and cost. Notice the lack of “customer delivery” or “safety.”

Within Toyota, all processes are closely linked to each other, and the “customer” is actually the next process. Given these tight connections and the fact that all processes in the plant and throughout the entire supply chain are inherently linked, if you fail to meet the customer demand (the next process), the entire operation will begin to stop, one process at a time (like dominos). For this reason, the satisfaction of the customer is implicitly understood and does not need to be measured separately. If a process is unable to meet the demand, it is a productivity issue. In addition, safety is an implicit expectation for everyone, and as such, may be “omitted” from the discussion of measures. Safety as the number one priority is a given.

It may helpful to think of these relationships in terms of the problem, symptoms of the problem, and the causes of the problem.

Using a medical condition as an analogy: Suppose you visit the doctor and complain of aches and fever. These are not the problem. They are symptoms of the problem. The problem is that you don’t feel well (and as a result may miss work or other activities). The doctor will take information and perform tests and gather facts (vital signs) that are part of the analysis, to find the cause of the aches and fever. Visually, the process looks like Figure 14-2.

Symptoms are presented to the side of the problem, as in “I have this problem, and as a result I have these symptoms.” To get to the cause(s), the information is analyzed to evaluate all possibilities. The symptoms are an important piece in the overall understanding of the problem. They provide supporting evidence that a problem exists. They also provide quantifiable data showing the magnitude of the problem. In this case, a fever of 104 degrees is more significant than a fever of 100, thus increasing the need to treat the problem.

The relationship of the three primary measures will follow the same model of Problems, Symptoms, and Causes, as shown in Figure 14-3.

In this case, low productivity would be the problem, poor quality a cause, and high cost a symptom or result. Using this model is important because it forces consideration of the bigger picture. We may believe that a repetitive quality problem is the true problem, but if we look further, we find there is an issue having a greater impact (this is assuming that the rule to never knowingly pass a defect to the next process is followed). Quality is a causal factor for poor productivity.

Figure 14-2. Illness symptoms versus root causes

Figure 14-3. Problem symptoms versus root causes

This thought process is depicted in Figure 14-4. The problem is perceived at the point of recognition (where the problem is “found”). To consider this “problem” in a larger context, we would use a statement such as; “We have this problem, therefore, this happens.” For example, suppose that the perceived problem is a machine malfunction resulting in scrap parts. The statement would be, “The machine malfunctions, therefore the part is scrap.” Continuing this line of thinking we state, “The part is scrap, therefore we are losing production capacity and increasing cost. Therefore, we are not able to meet the production requirement,” or, “Therefore our cost it too high.” At this point we begin to understand the greater significance of the true problem.

If we do not consider the situation in a larger context, we may limit the possible solutions as well and the total impact of solving a larger problem. Thinking in this way allows us to identify the true problem and thus provides three distinct advantages:

1.Ensuring that the most significant opportunity has been captured maximizes results with minimal effort.
2.Taking a larger view opens the possibility of solving the true problem by correcting causes in addition to the ones initially identified.
3.The lower-level cause identified may be very difficult to correct (which is why it is perceived as the biggest problem), and focusing only on this difficult condition will preclude consideration of larger and easier causes, which lead to greater opportunity.

The following was an actual conversation between a Toyota sensei (teacher) and a process engineer at an automotive parts plant. It examines the challenge of shifting focus from the perceived problem to the true problem.

Sensei: What is the problem in your area?

Engineer: The welding robot keeps breaking down. (The perception of the “problem” is based on personal experience and the person’s role.)

Sensei: Are you sure that is your problem?

Engineer: Yes. It breaks down all the time. We’ve tried various things to correct it but have had only limited success. We need to get a new robot. (Notice the jump to a solution.)

Sensei: I am not sure that is your real problem.

Engineer: Yes it is. It has been the problem for a long time. We have data to show how much it breaks down.

Sensei: I am sure it breaks down, but I am still not sure it is the real problem.

Engineer (a little angrily): It is the problem. I’ve been working on this for almost four years and I can tell you it is a problem. (Is it the problem or a problem?)

Sensei: Yes, I know you’ve been working hard on the robot; however, let me explain why it is not the real problem. When the robot breaks down, what happens?

Engineer: There is a fault at Loading Zone 3 because the weld nut does not feed. We’ve been working with the vendor to improve the feeder.

Sensei: Okay, what I mean is, what happens to the line when the robot breaks down?

Engineer: It stops, of course.

Sensei: When the line stops, what happens?

Engineer: Everyone stands around, and they call me to fix the robot.

Sensei: I mean, what happens to the flow of product?

Engineer: It stops.

Sensei: When the product flow stops, what happens?

Engineer: Everyone stands around.

Sensei: I mean, what happens to our ability to make parts?

Engineer: Of course we can’t make parts with the line stopped!

Sensei: So we are not able to satisfy our customer with the required number of parts?

Engineer: We can’t meet the demand without working overtime.

Sensei: So the real problem is that we are unable to meet customer demand without working overtime?

Engineer: No. The problem is the robot.

Sensei: Well, let’s go to the line and look.

As the sensei and engineer proceed to the line, the engineer wants to take the sensei to the robot to show him the “problem.” The sensei knows that line stoppage for any reason will ultimately affect the ability to meet production demand and that the robot is only one possibility. Therefore, it is further down the causal chain and not the high-level problem he’s looking for. The sensei takes the engineer to the end of the line to observe flow. In a few minutes he notices that the flow stops.

Sensei: Why did the line stop?

Engineer: The employees are rotating positions.

Sensei: How often do they rotate?

Engineer: Every half hour, but you can’t change that without causing a large problem with the employees. They all agreed on a half-hour rotation for ergonomics.

Sensei: My concern in not how often they rotate. I am concerned that when they do rotate, the line stops for about four to five minutes. That is as much as 10 minutes every hour, nearly 20 percent lost time!

They watch the line a little longer and again the flow stops. This time it is because the shipping container is full and waiting for the material handler to remove it and bring an empty one.

Sensei: Why did the line stop?

Engineer: The container was full and they needed a new one. The only way you’re going to prevent that is to have a material handler here full-time, and we don’t have enough material handlers for that.

Sensei: (Sternly) There is always more than one way to solve any problem. I’m sure we can design a system for exchanging the containers in a way that does not stop the product flow and does not require a material handler here full-time. Right now, though, I am just trying to understand the true problem.

Here is how the causal chain appears to the engineer: Problem: The robot breaks down.

Why? There is a run fault signal in Zone 3.

Why? The nut does not feed.

Why? The equipment is not designed correctly.

Where does this path lead? It leads to a dead end! It is a dead end that can consume large amounts of time and money attempting to correct a very challenging issue. In the meantime, the “low hanging fruit” is falling from the tree!

Examining a Problem in Reverse

Now let’s look at the causal chain from the sensei’s point of view. First, he begins with the problem as pointed out by the engineer, and using the “therefore” method, he proceeds back up the chain until he’s sure he has found the true problem, as shown below. Note that we begin at the perceived problem line and continue to state “therefore” proceeding upward until the true problem is identified.

Therefore: The process can’t meet demand without overtime. This is the true problem.

Therefore: Process doesn’t make parts. Therefore: The product flow stops.

Therefore: The line stops.

The robot breaks down. Start with the perceived problem and work up to find the true problem.

Once the true problem and resulting symptoms are identified, it’s possible to compare the full implications of the true problem and consider the value of proceeding with the process of solving the problem. It is still necessary to define the extent of the problem and its characteristics.

Defining the Problem

In order to be defined as a “problem,” four pieces of information are required:

  1. The actual current performance with some historical trend
  2. The desired performance (standard or goal).
  3. The magnitude of the problem as seen by the difference between the actual and desired (sometimes referred to as the “gap”).
  4. The extent and characteristics of the problem or

When presenting this information, a picture is worth a thousand words. Always try to explain the situation visually with a trend graph (Figure 14-5). The trend graph should include enough historical data to show how long the condition has existed (for long-term performance improvement opportunities a minimum of six months is recommended if available). The data should be displayed so the characteristics of the problem are seen. For example, does the problem appear to be getting better, worse, or staying the same? This understanding assists in determining the importance of addressing this problem versus other problems. If the problem is getting worse, more immediate action may be necessary, such as a short-term countermeasure. If the situation is getting better or staying the same, the future results are more predictable (not likely to get worse) and the consequences of inaction (which is always a considered action) are understood. The goal is to portray the situation so an accurate assessment is possible.

Figure 14-5. Trend chart of monthly units per hour

This is best achieved using actual facts and not assumptions or “feelings.” Be wary of data coupled with the words “I think” or “ I feel”! The goal is to elevate problems and to get a clear understanding of their characteristics so we can understand what will be required to solve them and how difficult that will be. A problem that’s stated in a way that makes it look better than it truly is does not help in the problem-solving process (Figure 14-9).

Also consider the stability of the problem. Are the results consistent day-to-day (or period-toperiod), or are there large swings with varied good and bad results? Problems with a high degree of variation from period to period indicate a situation that is out of control. There are probably many contributing factors, and isolating the causes may be difficult. An intermittent problem is also harder to analyze because it does not occur consistently, and therefore seeing the problem firsthand is difficult and often requires an extended observation to identify the causes.

The charts in Figures 14-6 to 14-11 were generated using the Microsoft Excel charting function (primarily for ease of printing). Excel will automatically select scaling based on the high and the low data points and the variation. In most cases this scaling is effective for visually understanding the problem. Often the data is collected and charted manually (which is preferred by Toyota) and the scale is established incorrectly. The charts show some common situations encountered when charting data to develop a thorough understanding of the problem.

The chart in Figure 14-6 has an insufficient number of data points. In this example, it is not possible to get a clear understanding of the trend. Usually we need to see 6 to 12 months of history to gain a clear perspective of the trend of an issue. For the trend, a monthly summary (average) of results is preferred to show the higher-level, long-term direction of the problem.

Figure 14-6. Chart with insufficient data points to see trend

Figure 14-7 shows the detail necessary to understand the daily characteristics of the problem. The performance of this fabrication process varies from day to day within a range. This process has not reached a level of stability, and the variation indicates the possibility of multiple issues contributing to the instability, thus representing a more challenging problem to solve.

Figure 14-7. Chart with sufficient date points to see trend

Figure 14-8 shows the same data as Figure 14-7 but the variability of performance is artificially inflated due to a compressed scale on the chart. Visually, the problem appears larger than it truly is. It’s important for a chart to have the correct visual impact so everyone has a clear understanding of the challenge ahead.

Figure 14-8. Chart with inflated appearance of variation due to scale

Figure 14-9 shows the same data as Figures 14-7 and 14-8. Notice how the variation is visually smoothed. This process appears more stable, and thus is misleading. An excessively large scale causes the artificial smoothing effect.

Figure 14-9. Chart with artificially smoothed variation due to scale

The chart in Figure 14-10 shows the effect of smoothing by averaging daily data on a weekly basis. The visual impact is lessened, and the daily variability inherent in this process will not be seen, thus giving a false sense of stability in the process.

Figure 14-10. Chart with artificially smoothed variation by averaging

Collecting data is an important part of the philosophy of building a culture to stop and fix problems, as described in Chapter 8. The greatest benefit is gained by recognizing problems in “real time” and correcting them immediately. Data used to solve problems is interpreted from the perspective of long-term trends and resolving “systemic” issues.

Building a Strong Supporting Argument

As shown in the above examples, there will be symptoms that go along with problems. In the case of businesses, the symptoms will be reflected in confirming performance indicators. For example, an inability to meet customer demand will also be reflected in additional overtime, missed or late shipments, or increased backlog. These corresponding indicators provide supporting evidence of the validity of the problem and the merit of correcting it.

Toyota uses the corresponding indicators to support the process of focusing on the most important issues. Problems are evaluated to determine which require the most immediate attention using the following criteria:

  • How important is the problem in the overall context of customer satisfaction, departmental, or company goals? Safety problems are automatically the highest-level importance.
  • What deadlines are dependent on the resolution of the problem, and what is the consequence if the deadline is not met? The ability to meet a change in a customer requirement deadline is considered a high urgency.
  • Is the problem getting worse, improving, or staying the same? When comparing problems it is necessary to consider whether every problem should be addressed.

By showing the effect of a specific problem on customer service, quality, safety, or cost, it is possible to develop a compelling argument to correct this specific problem versus other problems. This method of prioritization ensures that resources are focused appropriately on the most important and valuable problems. Following safety concerns, problems that negatively affect the customer take precedence. This could include missed shipments, late shipments, and quality problems. Cost issues can easily be compared to ensure that the larger issues are being handled promptly. The Toyota Way necessitates building a strong rationale for attacking any problem. If a strong rationale has not been developed, the question “Why did you pick up this problem?” would surely be asked. The format for showing the supporting indicators is the same as the problem symptom model above.

A complete example of a problem statement is shown in Figure 14-11. Note that the summary statements, along with the graphs, are sufficient to thoroughly explain the problem situation and the corresponding issues. In this example the pictures tell the story and brief explanatory statements are used. Here, the true problem is the inability to meet the production requirement. As a result, overtime is used to compensate for the problem (increasing cost), and customer service is also declining. The problem with its supporting evidence allows us to “size up” this problem and determine the benefit if it is solved (and also determine a sensible investment to make in the solution that will provide a good return on the investment of time and expense).

Now that the problem and the effect of the problem on other performance indicators is thoroughly understood and a decision is made to correct the situation, it’s time to develop a deeper understanding of the causes of the problem.

Figure 14-11. Complete problem statement

Reflect and Learn from the Process

Identify and select a problem you want to solve and use to reflect upon in Chapters 14 through 18. The problem should be significant, but not one of the most difficult problems you have. We suggest learning the problem-solving process on simpler issues before tackling more difficult ones.

1.Gather facts related to the problem and define the problem according to these criteria:
a.Display the actual performance history (at least six months) in a line graph format.
b.Show the goal or standard (current and/or in the future).
c.Identify the gap between the actual performance and the goal.

2.Consider the information that you believe depicts your problem.
a.Are you sure you have identified the “true problem”?
b.Can you make a connection directly to a safety, quality, delivery, productivity, or cost performance measure?

3.Clarify the significance of solving this problem.
a.Identify other issues related to this problem (items affected by this problem). Quantify them by graphing them.
b.Can you verify that it is important to “pick up this problem”?
c.Quantify the value of solving this problem (don’t spend a dollar to solve a five-cent problem).
d.Is it worth your time or the time of others to solve this problem?
e.How much do you want to invest in solving this problem?

4.Based on your value quantification in the previous question, determine the most cost effective method to proceed with the problem.
a.Will you “work the problem” personally?
b.Will you delegate the problem to others and only follow up?
c.Will this problem require a large team, small team, or a single individual to solve it?