catwoe-analysis

What Is The CATWOE Analysis And Why It Matters In Business

The CATWOE analysis“>analysis is a problem-solving strategy that asks businesses to look at an issue from six different perspectives. The CATWOE analysis“>analysis is an in-depth and holistic approach to problem-solving because it enables businesses to consider all perspectives. This often forces management out of habitual ways of thinking that would otherwise hinder growth and profitability. Most importantly, the CATWOE analysis“>analysis allows businesses to combine multiple perspectives into a single, unifying solution.

Understanding the CATWOE analysis

In business, a significant impediment to problem-solving lies in the perception of the problem itself. 

Key stakeholders will perceive the problem differently and as a result, will come up with different solutions.

Consider the example of a plastics factory with an inefficient, loss-making production process. An investor in the facility might seek to sell off the investment to recoup costs. Employees may suggest automation or other improvements to increase efficiency. Community groups may recommend expansion to drive more sales and stave off possible redundancies.

The six perspectives of the CATWOE analysis

Customers (clients)

Customers and clients are stakeholders for whom the system or process exists. They usually benefit from the result of a process or suffer when it changes. In other words, they are the potential winners and losers of a given solution.

Actors

Actors are those who implement changes in a system or process as part of a solution. Often, actors will be employees, suppliers, or agencies. What is the impact of a solution on these actors, and how might they react? What role will they need to play to implement the solution?

Transformation

How does the problem transform business operations? In the case of the plastics facility, how do production inefficiencies impact logistics, distribution, and profit margins? What adjustments to processes or procedures will need to be made once a solution is found?

World view

What is the justification for the transformation of the system or process? What is the wider impact of any solution and what issues may it cause? Is the particular problem going to cause chronic and widespread damage, or is it more localized and short-lived?

This stage of the analysis“>analysis is important because it requires that each problem is considered equally – regardless of any opinions on real or perceived discrepancies in severity.

Owner

Owners describe any individual who must necessarily take ownership of the problem. Were they part of the problem to begin with? If not, can they be part of the solution?

Assigning ownership of a problem is also important because it increases employee buy-in and motivation.

Environment constraints

Lastly, each problem should be judged according to the realistic probability that it can be overcome.

Environmental constraints are impediments that may hinder or prevent solutions from being implemented to a process. This includes legal issues, competition, financial regulation, and a lack of available resources or project scope.

Key takeaways

  • The CATWOE analysis is a holistic approach to problem-solving that considers a range of different perspectives.
  • CATWOE is an acronym that stands for: customers, actors, transformation process, worldview, owners, and environmental constraints. Each has a unique perspective on a single problem and each must be fairly and equally considered.
  • To successfully implement solutions within an organization, the CATWOE analysis advocates rigorous justification, employee empowerment, and awareness of potential constraints.

Read More:

Published by

Gennaro Cuofano

Gennaro is the creator of FourWeekMBA which reached over a million business students, executives, and aspiring entrepreneurs in 2020 alone | He is also Head of Business Development for a high-tech startup, which he helped grow at double-digit rate | Gennaro earned an International MBA with emphasis on Corporate Finance and Business Strategy | Visit The FourWeekMBA BizSchool | Or Get The FourWeekMBA Flagship Book "100+ Business Models"