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Defining the Problem: An Example

The right answer to the wrong problems is very difficult to fix.

Defining the problem may be the most important element in making effective decisions—and the one executives pay the least attention to. A wrong answer to the right problem can, as a rule, be repaired and salvaged. But the right answer to the wrong problem, that’s very difficult to fix, if only because it’s so difficult to diagnose.

The management of one of America’s largest manufacturing companies prided itself on its safety record. The company had the lowest number of accidents per one thousand employees of any company in its industry and one of the very lowest of any manufacturing place in the world. Yet its labor union constantly berated it for its horrendous accident rate, and so did OSHA. The company thought this a public-relations problem and spent large sums of money advertising its near-perfect safety record. And yet the union attacks continued. By aggregating all accidents and showing them as accidents per thousand workers, the company did not see the places where there was a very high accident rate. Once the company segregated its accidents and reported them in a number of categories it found, almost immediately, that there was a very small number of places, about 3 percent of all units, that had above-average accident rates. And an even smaller number of places had very high accident rates. But they were the places the union got its complaints from, the places whose accidents got into the papers and into OSHA reports.

ACTION POINT: The manufacturing company described above defined the problem of its accidents as a public-relations problem. What “facts” did this problem definition ignore, making it the wrong definition?

The Effective Executive
The Elements of Decision Making (Corpedia Online Program)

* Source: The Daily Drucker by Peter F. Drucker

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