In essence, a root cause analysis involves the identification of problem root causes to devise the most effective solutions. Note that the root cause is an underlying factor that sets the problem in motion or causes a particular situation such as non-conformance.
Root Cause Analysis (RCA)
Description
Analysis
Implications
Applications
Examples
1. Define the Problem (DP)
RCA begins by clearly defining the problem or issue that needs analysis and resolution.
– Describe the problem’s symptoms and their impact on operations or outcomes. – Gather data and evidence related to the problem. – Establish the scope and boundaries of the analysis.
– Ensures a clear understanding of the problem’s nature and its significance. – Helps in setting the context for the root cause analysis process.
– Investigating equipment failures in a manufacturing facility. – Identifying the reasons for a decline in product quality.
Problem Definition Example: Defining a recurring issue of missed project deadlines.
2. Data Collection (DC)
Collect relevant data and information related to the problem.
– Gather data through various means such as interviews, surveys, observations, or document review. – Identify potential sources of information and evidence. – Ensure data collection is systematic and comprehensive.
– Provides a factual basis for analysis and decision-making. – Ensures that the analysis is based on accurate and relevant information.
– Investigating the causes of a safety incident in a construction project. – Analyzing customer complaints to identify recurring issues.
Data Collection Example: Collecting maintenance records, equipment logs, and incident reports for a machinery breakdown.
3. Cause Identification (CI)
Identify potential causes or factors contributing to the problem.
– Brainstorm and list all possible causes or factors that may be related to the problem. – Categorize causes as immediate (symptoms), contributing, or root causes. – Use tools like the “5 Whys” technique to probe deeper into the causal factors.
– Helps in generating a comprehensive list of potential causes for thorough analysis. – Identifies the distinction between symptoms and underlying causes.
– Determining why a software application frequently crashes. – Investigating the reasons behind a product’s high defect rate.
Cause Identification Example: Identifying possible causes for a sudden drop in website traffic.
4. Data Analysis (DA)
Analyze the collected data to evaluate the potential causes and their relationships.
– Examine the data to identify correlations, patterns, or trends that may point to specific causes. – Use statistical and analytical techniques to test hypotheses and assess causal relationships. – Consider the temporal sequence of events and dependencies.
– Helps in identifying which potential causes are most likely to be root causes. – Provides evidence-based support for causal relationships.
– Analyzing production data to determine why a manufacturing process consistently produces defective products. – Investigating financial data to find the reasons for declining revenue in a retail business.
Data Analysis Example: Analyzing software error logs and user feedback to identify common patterns related to crashes.
5. Root Cause Identification (RCI)
Narrow down the potential causes to identify the true root causes.
– Apply critical thinking and analysis to differentiate between contributing and root causes. – Focus on identifying the causes that, when addressed, will prevent the problem from recurring. – Verify the root causes through additional evidence or testing.
– Enables the precise identification of the underlying issues causing the problem. – Ensures that corrective actions target the true root causes.
– Determining the fundamental reasons behind frequent project delays. – Identifying why a supply chain disruption occurred in a logistics company.
Root Cause Identification Example: Concluding that a software bug in a critical component is the root cause of system crashes.
6. Develop Corrective Actions (CA)
Once root causes are identified, develop specific corrective actions to address them.
– Generate a list of actionable steps and recommendations to eliminate or mitigate the root causes. – Specify responsible individuals or teams for implementing each corrective action. – Set timelines and priorities for corrective actions.
– Ensures that the organization has a clear plan to eliminate the identified root causes. – Facilitates the implementation of preventive measures to avoid recurrence.
– Creating a project plan to address the root causes of product defects. – Developing a strategy to prevent future safety incidents on a construction site.
Corrective Actions Example: Implementing a software patch to fix a critical bug and prevent system crashes.
7. Implement Corrective Actions (ICA)
Execute the corrective actions as planned and monitor their progress.
– Assign responsibilities for each corrective action and ensure accountability. – Track the progress of implementation and ensure that actions are carried out as intended. – Communicate the status of corrective actions to relevant stakeholders.
– Ensures that corrective actions are executed effectively and within specified timelines. – Allows for real-time monitoring and adjustment of actions as needed.
– Carrying out the software patch implementation to fix the root cause of crashes. – Monitoring the construction site to ensure safety measures are in place as per the corrective action plan.
Implementation Example: Rolling out a revised production process to address root causes of product defects.
8. Evaluate Effectiveness (EE)
Assess whether the corrective actions have effectively eliminated the problem.
– Measure and evaluate the impact of corrective actions on the problem. – Use data and performance indicators to assess the effectiveness of actions. – Compare post-implementation results with pre-implementation data to verify improvement.
– Determines whether the root causes have been successfully addressed. – Validates the effectiveness of the corrective actions and their impact on outcomes.
– Assessing whether the new software patch has eliminated system crashes. – Evaluating whether safety incidents have significantly reduced after implementing safety measures on the construction site.
Effectiveness Evaluation Example: Comparing product defect rates before and after process changes to verify improvement.
Table of Contents
Understanding a root cause analysis
A root cause analysis (RCA) uncovers the root causes of a problem so that the most effective solutions can be devised.
Root cause analyses can be traced back to the concept of Total Quality Management (TQM), where employees and organizations strive to improve their ability to create valuable products and services for the customer.
The Total Quality Management (TQM) framework is a technique based on the premise that employees continuously work on their ability to provide value to customers. Importantly, the word “total” means that all employees are involved in the process – regardless of whether they work in development, production, or fulfillment.
The Fishbone Diagram is a diagram-based technique used in brainstorming to identify potential causes for a problem, thus, it is a visual representation of cause and effect. The problem or effect serves as the head of the fish. Possible causes of the problem are listed on the individual “bones” of the fish. This encourages problem-solving teams to consider a wide range of alternatives.
The fishbone diagram, also known as the cause-and-effect or Ishikawa diagram, is considered one of the seven basic quality tools for process improvement.
The diagram can be used to structure a brainstorming session and is ideal for teams who have fallen into habitual ways of thinking and operating.
Essentially, the team first agrees on a problem statement and then brainstorms the major categories (causes) of the problem.
Individuals continue to question why a cause may occur as they construct an arrowed diagram similar in appearance to the shape of a fish.
A failure mode and effects analysis (FMEA) is a structured approach to identifying design failures in a product or process. Developed in the 1950s, the failure mode and effects analysis is one the earliest methodologies of its kind. It enables organizations to anticipate a range of potential failures during the design stage.
Initially developed by the U.S. military in the 1950s, the FMEA is a step-by-step framework for identifying failures in a design, process, product, or service.
There are two primary components to the failure mode and effects analysis:
Failure modes – the ways in which something may fail and the errors and defects (whether actual or potential) that may affect the customer, and
Effects analysis – the study of the consequences of those failures.
Note that failure modes and their associated effects on the system are recorded in a specialized FMEA worksheet.
The subsequent analysis, which may be qualitative or quantitative, was one of the first systematic and structured root cause analysis techniques.
General principles of a root cause analysis
Despite the various approaches to performing a root cause analysis, most are governed by principles such as:
Factor identification
What is the timing, location, nature, and magnitude of the negative outcome some factor is producing?
This will dictate which actions, behaviors, or conditions need to be altered to prevent problem recurrence.
Cost-effectiveness
Root cause analyses strive to prevent problem recurrence in the simplest and most cost-effective means possible.
Performance focus
Removing the root cause of a problem to bolster performance is a more prudent choice than simply removing its symptoms.
Evidence-based
Successful root cause analyses are performed methodically using one of the tools we mentioned earlier.
Conclusions and root cause claims must be supported by verifiable evidence.
Multi-faceted problems
In most cases, there is more than one root cause to every problem.
Treat the symptoms for short-term relief while multiple longer-term solutions are devised.
Root cause analysis and Gap analysis
A gap analysis helps an organization assess its alignment with strategic objectives to determine whether the current execution is in line with the company’s mission and long-term vision. Gap analyses then help reach a target performance by assisting organizations to use their resources better. A good gap analysis is a powerful tool to improve execution.
Where the root cause analysis is very effective in identifying the core issues of an organization.
The gap analysis tries to bring alignment between executing and long-term vision.
In other words, it helps to ask, in the execution process, whether the organization is moving toward its long-term desired goals.
Thus, the root cause analysis combined with the gap analysis can really help align short and long-term.
Root cause analysis vs. 5Whys
The 5 Whys method is an interrogative problem-solving technique that seeks to understand cause-and-effect relationships. At its core, the technique is used to identify the root cause of a problem by asking the question of why five times. This might unlock new ways to think about a problem and therefore devise a creative solution to solve it.
Like the root cause analysis, the 5 whys tries to go to the core of a problem with a simple method of asking five times why to move from the superficial of an issue to the root.
Thus, the 5 whys method can be a great companion to the root cause analysis to uncover fundamental assumptions about the business that can be tested!
Case Studies
Change Analysis:
Scenario: A software company notices a decline in user engagement after a recent update.
RCA Application: By comparing the software before and after the update, they determine that a new feature is causing confusion among users.
Solution: The company decides to provide clearer onboarding tutorials and roll back certain aspects of the new feature.
Fishbone Diagram:
Scenario: A factory is experiencing a high defect rate in one of its products.
RCA Application: Using a fishbone diagram, they identify potential factors like machinery calibration, raw material quality, operator training, and ambient conditions. They discover that a combination of raw material inconsistencies and machine calibration is to blame.
Solution: The factory switches to a more reliable material supplier and establishes a stricter machine maintenance schedule.
Failure Mode and Effects Analysis (FMEA):
Scenario: An airline company wants to ensure the safety of its new flight procedures.
RCA Application: FMEA helps them anticipate potential failures. They identify that in rare scenarios, a new landing procedure could be risky.
Solution: The company modifies the procedure and provides additional training to the pilots.
5 Whys:
Scenario: A restaurant is receiving complaints about delayed service during peak hours.
RCA Application:
Why are customers waiting longer? Because orders are backed up.
Why are orders backed up? Because the kitchen is slow.
Why is the kitchen slow? Because they are waiting on ingredients.
Why are they waiting on ingredients? Because the inventory system isn’t effective.
Why isn’t the system effective? Because it hasn’t been updated to match the new menu.
Solution: The restaurant updates its inventory system and provides training to the staff on efficient ingredient management.
Pareto Analysis:
Scenario: An e-commerce platform wants to reduce customer complaints.
RCA Application: They list all the complaints and rank them. Using Pareto Analysis, they find that 80% of complaints are about delivery delays.
Solution: The platform invests in better delivery partners and provides more accurate delivery estimates to customers.
Fault Tree Analysis:
Scenario: A power plant experiences frequent blackouts.
RCA Application: Using a top-down approach, they analyze possible fault points. They determine that a specific transformer is the weak link.
Solution: The power plant replaces the faulty transformer and establishes a more rigorous inspection schedule.
Scatter Diagram:
Scenario: A call center is trying to reduce call duration without sacrificing service quality.
RCA Application: They plot call durations against different variables like call type, agent, time of day, etc. They notice a pattern where certain agents have longer call durations across all variables.
Solution: The call center provides additional training and resources to those agents to improve efficiency.
Check Sheets:
Scenario: A hotel wants to improve guest satisfaction.
RCA Application: They create check sheets for housekeeping to record any issues found in rooms. Over time, they notice a pattern of malfunctioning air conditioners.
Solution: The hotel conducts a comprehensive check of all air conditioners and replaces the faulty ones.
Key takeaways:
A root cause analysis (RCA) uncovers the root causes of a problem so that the most effective solutions can be devised.
The origin of root cause analyses can be traced back to Total Quality Management (TQM) where employees and organizations strive to improve their ability to create valuable products and services for the customer.
Root cause analysis tools include the change analysis, fishbone diagram, and failure mode and effects analysis (FMEA). Despite the various approaches to performing such an analysis, most are governed by common principles.
Key Highlights:
Root Cause Analysis Definition: Root cause analysis (RCA) is the process of identifying the underlying factors that cause a problem or a particular situation, such as non-conformance, to devise effective solutions.
Origin of RCA: Root cause analyses can be traced back to the concept of Total Quality Management (TQM) where organizations focus on continuous improvement and providing value to customers.
TQM Principles: Total Quality Management follows eight key principles, including customer focus, employee engagement, process approach, and continual improvement.
RCA Methods: Some popular root cause analysis methods are:
Change analysis: Identifying deviations in performance by comparing current and baseline conditions.
Fishbone diagram: A diagram-based technique to identify potential causes for a problem through brainstorming.
Failure mode and effects analysis (FMEA): A structured approach to identifying potential failures during the design stage.
General Principles of RCA: Common principles governing root cause analysis include factor identification, cost-effectiveness, performance focus, evidence-based analysis, and addressing multi-faceted problems.
RCA and Gap Analysis: Root cause analysis helps identify core issues, while gap analysis assesses alignment with strategic objectives, ensuring execution is in line with the long-term vision.
RCA vs. 5 Whys: The 5 Whys method is another problem-solving technique that complements RCA by asking “why” multiple times to uncover underlying assumptions and creative solutions.
A failure mode and effects analysis (FMEA) is a structured approach to identifying design failures in a product or process. Developed in the 1950s, the failure mode and effects analysis is one the earliest methodologies of its kind. It enables organizations to anticipate a range of potential failures during the design stage.
Agile Business Analysis (AgileBA) is certification in the form of guidance and training for business analysts seeking to work in agile environments. To support this shift, AgileBA also helps the business analyst relate Agile projects to a wider organizational mission or strategy. To ensure that analysts have the necessary skills and expertise, AgileBA certification was developed.
Business valuations involve a formal analysis of the key operational aspects of a business. A business valuation is an analysis used to determine the economic value of a business or company unit. It’s important to note that valuations are one part science and one part art. Analysts use professional judgment to consider the financial performance of a business with respect to local, national, or global economic conditions. They will also consider the total value of assets and liabilities, in addition to patented or proprietary technology.
A paired comparison analysis is used to rate or rank options where evaluation criteria are subjective by nature. The analysis is particularly useful when there is a lack of clear priorities or objective data to base decisions on. A paired comparison analysis evaluates a range of options by comparing them against each other.
The Monte Carlo analysis is a quantitative risk management technique. The Monte Carlo analysis was developed by nuclear scientist Stanislaw Ulam in 1940 as work progressed on the atom bomb. The analysis first considers the impact of certain risks on project management such as time or budgetary constraints. Then, a computerized mathematical output gives businesses a range of possible outcomes and their probability of occurrence.
A cost-benefit analysis is a process a business can use to analyze decisions according to the costs associated with making that decision. For a cost analysis to be effective it’s important to articulate the project in the simplest terms possible, identify the costs, determine the benefits of project implementation, assess the alternatives.
The CATWOE analysis is a problem-solving strategy that asks businesses to look at an issue from six different perspectives. The CATWOE 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 allows businesses to combine multiple perspectives into a single, unifying solution.
It’s possible to identify the key players that overlap with a company’s business model with a competitor analysis. This overlapping can be analyzed in terms of key customers, technologies, distribution, and financial models. When all those elements are analyzed, it is possible to map all the facets of competition for a tech business model to understand better where a business stands in the marketplace and its possible future developments.
The Pareto Analysis is a statistical analysis used in business decision making that identifies a certain number of input factors that have the greatest impact on income. It is based on the similarly named Pareto Principle, which states that 80% of the effect of something can be attributed to just 20% of the drivers.
A comparable company analysis is a process that enables the identification of similar organizations to be used as a comparison to understand the business and financial performance of the target company. To find comparables you can look at two key profiles: the business and financial profile. From the comparable company analysis it is possible to understand the competitive landscape of the target organization.
A SWOT Analysis is a framework used for evaluating the business’s Strengths, Weaknesses, Opportunities, and Threats. It can aid in identifying the problematic areas of your business so that you can maximize your opportunities. It will also alert you to the challenges your organization might face in the future.
The PESTEL analysis is a framework that can help marketers assess whether macro-economic factors are affecting an organization. This is a critical step that helps organizations identify potential threats and weaknesses that can be used in other frameworks such as SWOT or to gain a broader and better understanding of the overall marketing environment.
Business analysis is a research discipline that helps driving change within an organization by identifying the key elements and processes that drive value. Business analysis can also be used in Identifying new business opportunities or how to take advantage of existing business opportunities to grow your business in the marketplace.
In corporate finance, the financial structure is how corporations finance their assets (usually either through debt or equity). For the sake of reverse engineering businesses, we want to look at three critical elements to determine the model used to sustain its assets: cost structure, profitability, and cash flow generation.
Financial modeling involves the analysis of accounting, finance, and business data to predict future financial performance. Financial modeling is often used in valuation, which consists of estimating the value in dollar terms of a company based on several parameters. Some of the most common financial models comprise discounted cash flows, the M&A model, and the CCA model.
Value investing is an investment philosophy that looks at companies’ fundamentals, to discover those companies whose intrinsic value is higher than what the market is currently pricing, in short value investing tries to evaluate a business by starting by its fundamentals.
The Buffet Indicator is a measure of the total value of all publicly-traded stocks in a country divided by that country’s GDP. It’s a measure and ratio to evaluate whether a market is undervalued or overvalued. It’s one of Warren Buffet’s favorite measures as a warning that financial markets might be overvalued and riskier.
Financial accounting is a subdiscipline within accounting that helps organizations provide reporting related to three critical areas of a business: its assets and liabilities (balance sheet), its revenues and expenses (income statement), and its cash flows (cash flow statement). Together those areas can be used for internal and external purposes.
Post-mortem analyses review projects from start to finish to determine process improvements and ensure that inefficiencies are not repeated in the future. In the Project Management Book of Knowledge (PMBOK), this process is referred to as “lessons learned”.
Retrospective analyses are held after a project to determine what worked well and what did not. They are also conducted at the end of an iteration in Agile project management. Agile practitioners call these meetings retrospectives or retros. They are an effective way to check the pulse of a project team, reflect on the work performed to date, and reach a consensus on how to tackle the next sprint cycle.
In essence, a root cause analysis involves the identification of problem root causes to devise the most effective solutions. Note that the root cause is an underlying factor that sets the problem in motion or causes a particular situation such as non-conformance.
A break-even analysis is commonly used to determine the point at which a new product or service will become profitable. The analysis is a financial calculation that tells the business how many products it must sell to cover its production costs. A break-even analysis is a small business accounting process that tells the business what it needs to do to break even or recoup its initial investment.
Stanford University Professor Ronald A. Howard first defined decision analysis as a profession in 1964. Over the ensuing decades, Howard has supervised many doctoral theses on the subject across topics including nuclear waste disposal, investment planning, hurricane seeding, and research strategy. Decision analysis (DA) is a systematic, visual, and quantitative decision-making approach where all aspects of a decision are evaluated before making an optimal choice.
A DESTEP analysis is a framework used by businesses to understand their external environment and the issues which may impact them. The DESTEP analysis is an extension of the popular PEST analysis created by Harvard Business School professor Francis J. Aguilar. The DESTEP analysis groups external factors into six categories: demographic, economic, socio-cultural, technological, ecological, and political.
The STEEP analysis is a tool used to map the external factors that impact an organization. STEEP stands for the five key areas on which the analysis focuses: socio-cultural, technological, economic, environmental/ecological, and political. Usually, the STEEP analysis is complementary or alternative to other methods such as SWOT or PESTEL analyses.
The STEEPLE analysis is a variation of the STEEP analysis. Where the step analysis comprises socio-cultural, technological, economic, environmental/ecological, and political factors as the base of the analysis. The STEEPLE analysis adds other two factors such as Legal and Ethical.
Activity-based management (ABM) is a framework for determining the profitability of every aspect of a business. The end goal is to maximize organizational strengths while minimizing or eliminating weaknesses. Activity-based management can be described in the following steps: identification and analysis, evaluation and identification of areas of improvement.
PMESII-PT is a tool that helps users organize large amounts of operations information. PMESII-PT is an environmental scanning and monitoring technique, like the SWOT, PESTLE, and QUEST analysis. Developed by the United States Army, used as a way to execute a more complex strategy in foreign countries with a complex and uncertain context to map.
The SPACE (Strategic Position and Action Evaluation) analysis was developed by strategy academics Alan Rowe, Richard Mason, Karl Dickel, Richard Mann, and Robert Mockler. The particular focus of this framework is strategy formation as it relates to the competitive position of an organization. The SPACE analysis is a technique used in strategic management and planning.
A lotus diagram is a creative tool for ideation and brainstorming. The diagram identifies the key concepts from a broad topic for simple analysis or prioritization.
Functional decomposition is an analysis method where complex processes are examined by dividing them into their constituent parts. According to the Business Analysis Body of Knowledge (BABOK), functional decomposition “helps manage complexity and reduce uncertainty by breaking down processes, systems, functional areas, or deliverables into their simpler constituent parts and allowing each part to be analyzed independently.”
The multi-criteria analysis provides a systematic approach for ranking adaptation options against multiple decision criteria. These criteria are weighted to reflect their importance relative to other criteria. A multi-criteria analysis (MCA) is a decision-making framework suited to solving problems with many alternative courses of action.
A stakeholder analysis is a process where the participation, interest, and influence level of key project stakeholders is identified. A stakeholder analysis is used to leverage the support of key personnel and purposefully align project teams with wider organizational goals. The analysis can also be used to resolve potential sources of conflict before project commencement.
Strategic analysis is a process to understand the organization’s environment and competitive landscape to formulate informed business decisions, to plan for the organizational structure and long-term direction. Strategic planning is also useful to experiment with business model design and assess the fit with the long-term vision of the business.
Gennaro is the creator of FourWeekMBA, which reached about four million business people, comprising C-level executives, investors, analysts, product managers, and aspiring digital entrepreneurs in 2022 alone | He is also Director of Sales for a high-tech scaleup in the AI Industry | In 2012, Gennaro earned an International MBA with emphasis on Corporate Finance and Business Strategy.
