Introduction - Understanding Business Problem

Welcome to the module on “Understanding a Business Problem”. In any industry, you might come across a business problem at any point in time. In most cases, you will be thrown into the field with just a statement, such as:
 
"Our sales are declining. What do we do?"
"The company needs to increase its market share. How should we proceed?"
"The company is incurring huge losses. How do we cut them down?"
“There is a new competitor in the industry, which is affecting our profits. What should be done?"

How do you proceed with just one line of information? 

A wrong approach to solving any of the cases mentioned above will be to jump to conclusions and recommend solutions based on them. The suggestions made will be very open-ended and will provide no guarantee that the problem will be solved. 

Let’s take an example from the case above: if the request is to reduce the losses incurred by an online advertising company, the person will suggest: “The price per advertisement to charge the customers is very low; therefore, check the rates and increase the prices.” This is a favourable solution if the problem is actually in that area. However, on further exploration, you may discover that the huge losses may be due to:

• Inefficiency within the internal teams,
• Loss of customers due to bad quality of service, and many more reasons.

So, you cannot rely on luck when you are working as an employee or a service provider for any firm. Here is a list of what is wrong in the approach followed above:

• The use of company resources is not optimal, as the person would try and check each phase and department to solve one problem.
• The entire process will take much longer than it should have. During that time, the company or client firm might incur a hefty loss due to the problem at hand.
• The client might switch to a competitor seeing how unoptimised the entire process is.

 
As you would have noticed, this kind of approach can put you or the company in a lot of trouble. Let’s hear Anand’s view on problem-solving.

As mentioned, problem-solving can be broken down into five steps:

You will learn about the first step in this session, that is, understanding the problem.