Understanding the “Why-Why” Analysis in Small Business

Understanding the “Why-Why” Analysis in Small Business

understand – /ʌndəˈstand/ – verb interpret or view (something) in a particular way.

My first corporate job was in logistics, specifically supply and demand management. Whenever something had gone wrong e.g.a container of stock got delayed or we had shelf out of stocks etc. we would have to conduct a why-why analysis, to understand the root cause of the issue. I used to resent this exercise because of how tedious it was, but I was always grateful for the outcome because it gave us a good understanding of what really went wrong, and thus ensured that we corrected the root cause of the problem and not the symptom. It also showed us other gaps in our systems and process which we wouldn’t have spotted if we hadn’t taken the time to do this analysis.

This all came back to mind last week, when I was asked the following question by a small business owner: “Nokwazi, what do I do now? What do I do during this lockdown for my business so that I can operate better once my business can run again?” What was surprising for me, was that this business could be operating right now if it had explored digital / tech possibilities (but I digress). The point is, #Covid19 may be the presenting reason for the halt in business operations, but it may not be the root cause. There are parts of the business that may not have been going well, and we (as business owners/leaders) can use this time to better understand this, so that we can improve, adapt or even totally change our businesses to ensure future success.

What exactly is a “why-why” analysis aka root-cause analysis?

The name “why-why” is self explanatory. You asked the question why until you can’t ask why anymore. When you get to the point where you can’t ask why, then that is the root cause and you need to ensure that you address this. How does this work? Start with the presenting issue at hand:

  • The container of stock got lost
  • Why, did it get lost?
  • Because we had the wrong tracking number
  • Why, did we have the wrong tracking number?
  • Because it was incorrectly inputted in the system
  • Why, was it inputted incorrectly?
  • Because it was uploaded manually
  • Why…?
  • Because the system was down
  • Why…?
  • Because there was a virus
  • Why…?
  • Because the malware software had expired and wasn’t renewed
  • Why…?
  • Because the IT head left, and there was no replacement or (proper handover done /back-up when he left)
  • Why…?
  • Because it was a sudden resignation.

What exactly is the root cause of this lost container? Not what we would have initially assumed if we hadn’t done an analysis. This example is showing us that there may be a gap in the HR process for managing sudden resignations or that there is no personnel back-up process. We can also see that there is a need to further understand how the system got infected by a virus – and this can lead to another why-why analysis.

Part of my answer to the question posed by the small business owner was:“take this time to engage, research and understand”:

  • How you can service your customers better,
  • Your industry value chain: how it has been impacted and how it will need to change post lockdown,
  • Your operations: what you didor didn’t do well till this point and how you can improve,
  • How others are responding, and what you can learn from them,
  • Your systems: how can you leverage digital / tech platforms
  • Your financials: how you can improve or better manage them in the future,
  • Your business model: will it still be relevant and what will you need to adapt for future success.

Spot the problems in the different areas and use a tool, like the why-why analysis, to get to the root cause of your issues, and start correcting from there. Hopefully by the time we can press “play” again, you will be able to restart at a better position or level than you were before lockdown.

Nokwazi Mzobe

Founder of Matoyana Business Solutions and Matoyana Media and Creator of the Warrior Women Series

Matoyana Media is a subsidiary of Matoyana Business Solutions;an entrepreneurship development consultancy based in Johannesburg.We produce content for creatives, freelancers and small business owners to inspire & empower them to grow and thrive.

Contact:

info@matoyana.co.za

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