How To Create A Problem Statement In Business Analysis

The business problem statement is one of those techniques that describes the reasons for a ICT initiative in practical business related terms. It is the description of an issue currently existing which needs to be addressed and provides context for the problems that will be addressed.

Problem statements can be described in a single statement followed by a real example to emphasise the issue. When developing an understanding of the problems to be resolved think across the seven broad areas shown below.

Examples are given for each category.

The Business Problem Statement Categories

1. Strategy

Poor alignment with business objectives.
Initiatives are currently not aligned to an overall vision.
Siloed implementation of projects.

2. Service / Products

Impediment to service delivery due to untimely retrieval of information.
Slow responsiveness in engaging sales leads due to untimely retrieval of information.
High level of product returns due to errors made on sales orders.

3. People

Inadequate training of staff and/or lack of capacity for staff to support areas of the business experiencing bottlenecks.
Poorly defined roles and responsibilities creates confusion and poor responsiveness to operational demands.
Poor service delivery due to staff capacity and training issues.

4. Processes

Myriad of duplicated business processes and applications.
Intensive manual processing due to physical handling of paperwork, mail outs and manual coordination of events.
Double data entry and manual maintenance of data in spread sheets or personal databases.

5. Applications

Poorly developed functionality due to inadequate definition of business and functional requirements.
Out of date functionality caused by a constantly evolving business climate.
Little or no application support due to proprietary or redundant software.

6. Information

Unstructured information and content stored on various devices making search and retrieval very difficult.
No metadata attached to information making search and retrieval difficult.
Disparate methods of coding the same types of datasets in disparate repositories.

7. Infrastructure

Not a lot known about all systems making the strategic coordination of maintenance difficult.
Multiple applications are supported on multiple systems creating unnecessary maintenance overheads by supporting duplicate systems.

When you have understood problems, describe the risks associated with each to fully emphasise the potential impacts on the business (e.g., costs, inefficiencies and lost opportunities).

A Problem Statement Example

Below is an example describing a problem statement, description and associated risk for a highly manual business process that can easily be resolved with technology.

Problem Statement: Intensive manual processing due to physical handling of paperwork.

Description: Annual leave forms are typically filled out by the Employee, printed, sent to the Manager/Delegate for approval, sent to Human Resources for verification and data entry, scanned and uploaded to the EDRMS, and then sent to Payroll for (re) data entry.

Risk: This highly manual scenario leads to 'bottlenecks' in service delivery and promotes the risk of poor organisational response to business and lost time that should be spent carrying out core business.

How to Develop Your Problem Statement

To develop the problem statement and associated risks of a project, engage with managers and subject matter experts within the relevant business areas. Ask them questions specific to each of the six categories described above to bring out the details of where the problems lie. The Five Whys is an excellent technique to support your questioning approach.

This strategy can be implemented in the project's initial set up and analysis phases irrespective of the methodology (i.e., Agile or Waterfall) being utilised. It is useful for developing project mandates and business cases.