A typical conversation:
Chief Financial Officer (CFO): Our inventory has gone through the roof! It turns only 3 times! That means we carry stock enough, in theory, for 4 months a year. Can't afford that. Our lead times from suppliers are just a few weeks. Why is this so then? We need to bring it under control immediately.
Planning Manager (PM): That's right. We need to take some steps. This is not new. The turns have been at low levels and have been deteriorating for some time.
CFO: Tighten purchases!
PM: Sure. I will ask sales managers to firmly commit the projected sales for high volumes and large projects through a bank guarantee from customers. Shall I? Customers want commitment from us but without any guarantee from them.
CFO: No, unfortunately that's not how our industry works as I understand.
PM: True. Then let us be ready for some last-minute imports through airfreight and let us not worry about economy of scale. A little higher unit prices. We can partly pass them on sometimes to our customers - but not sure if we definitely can.
CFO: No, no, no! We can't have our gross margins eroding. We can't add costs.
PM: Not sure how we can avoid that. We will need to write off some amount every month if we need to reduce the current stale or dead stocks - the slow and obsolete stocks! Or maybe downgrade and sell or may be return to the suppliers at some salvage value?
CFO: Nope ... we have provided very small budget for that and that won't change next year.
PM: So - what would you like to do? May be ... do all this in small steps?
CFO: That's a good idea. Let us do that.
PM: With all due respect - that's how we have reached this stage!
__________
I have heard this conversation several times in several organizations. This is one of the perennial problems many industries have that are discussed every now and then and yet there is no single and correct solution. Similar problems exist in almost all the areas of management.
Heroic arguments of disciplining the recalcitrant and difficult employees lose their edge when indispensability of the employees surfaces due to years of experience and some unique special skills.
A dominant supplier holds the customer's business at ransom in spite of all the supplier relationship management values agreed in principle and the customer caught in a catch-22 situation helplessly accepts the new demands.
These all are wicked problems - not tame.
Problem solving, as a practice, is replete with tools and techniques. It is however seldom consciously discussed before getting into problem-solving whether the problem on hand is likely to be a wicked problem or a tame one. This distinction, if carefully acknowledged earlier, can change the orientation of the entire problem-solving team. Not only are the tendencies of groupthink minimized, but also the members are subconsciously prepared to address new layers of problems which gradually become visible as the problem-solving team digs deeper into the subject-matter.
The terms were first used as a concept in 1973 by Horst Rittel and Melvin M. Weber and the use was primarily in the context of social policy and planning. However, this distinction is quite pertinent in management too.
Tame problems, simply said, have definite solutions; they can be and often are completely solved, there can be a binary conclusion as whether they exist or are eliminated, and the solutions required are usually straightforward and standardized. A flat tyre while driving or a machine that breaks down due to a known fault such as a broken chain are typical examples. Sometimes prevention is possible too and the contingency plans or corrective actions required can be easily standardized.
Wicked problems on the other hand, are complicated or complex, with no single and conclusively complete solution and with no end-result after a solution is implemented that qualifies the problem as "solved" or not. Often the condition only improves to some extent or not. In socio-political areas, poverty, crime, and such other problems are considered wicked problems. Prevention, contingency actions as well as corrective actions cannot be fully standardized and guaranteed for effectiveness.
This conceptual distinction helps immensely in coaching and utilizing problem-solving teams.
Once it is envisaged that the problem on hand is a wicked one, a few approaches can be firmly embraced that help the problem-solving team.
1) No single correct solution
There is no single correct solution for wicked problems. There are a few better or worse. Often a combination of multiple solutions works. Understanding this principle of "spectrum thinking" and conscious avoidance of "binary thinking" makes problem solving easier and faster. Complete clarity is a myth. Ambiguity and obscurity are inevitable. Any perfectionism leading to a quest for complete clarity is a hurdle - not a helpful ambition.
2) Data helps
The more the relevant and contextual data, the better is the visibility. While this is true for tame problems too, it is particularly important to keep in mind while handling wicked problems. As always it is important to appreciate that the data must be combined with sound judgment for effective decisions. Furthermore, often invaluable insights come from unique instances hidden in unorganized data.
3) Experimentation helps
Experimentation and prototyping are crucial in solving wicked problems. Goes without saying that, pilots and samples play a vital role in working on wicked problems. Pilots and samples provide precursors to the larger impacts to follow which can be carefully managed.
4) Iterative lifecycle helps
It is best to avoid mega-action-plans while appraising and solving wicked problems. Instead creating a small iteration of PDCA/PDSA cycle to start with and continuing such iterations to increasingly larger scopes is the safest though not necessarily the fastest way forward.
5) A team of specialists working with a few others (fresh minds)
Wicked problems almost always present facets unknown to even experienced eyes. Therefore, it is always desirable that the team is a mixed group of specialists and completely new participants whose role is only to bring in fresh ideas and thoughts - or even play devil's advocates.
6) Plotting trends is important
Wicked problems are often related to ups-and-downs or crests-and-troughs. A satisfactory improvement or an alarming setback is often ephemeral. Only a long-term trend establishes the sustenance of progress.
7) Root causes are sometimes irrelevant
Root causes, though important for understanding the overall subject matter, are often irrelevant in developing a solution in the near future. Sometime buried in the history, for example, is the rationale of making a wrong purchase of an equipment that keeps deteriorating plaguing the current production performance. Apart from how an equipment should be evaluated while sourcing in future, the root cause does not necessarily give any other valuable information on how the equipment needs to be maintained now.
With all these complexities however, the awareness of and acceptance to the wickedness of the "wicked problems" leads to much more in-depth and comprehensive problem-solving process.
As quoted by H.L. Mencken:
"For every complex problem, there's a solution that is simple, neat, and wrong."
It is always better to accept the problem as complex and wicked and embrace the complexity at the outset. That makes the further journey not only easier, but faster too.
- Nilesh Pandit
March 9, 2023
#lean #LeanManufacturing #ChangeManagement #ContinuousImprovement #OperationalExcellence #leanleadership #CollwisMax #problemsolving