Study Notes by Niladri & AI

ch08-defining-the-problem

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Chapter 8: Defining the Problem

tpp pyramid-principle problem-solving problem-definition sequential-analysis

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Overview

Chapter 8 introduces the Problem Definition Framework, a structured tool for precisely articulating any business problem before attempting to solve or communicate about it. Minto argues that a problem exists whenever there is a gap between an Undesired Result (R1) — what a situation currently yields — and a Desired Result (R2) — what the decision-maker would prefer. The Solution is whatever bridges that gap.

The chapter embeds this gap concept into a broader Sequential Analysis process with five questions: Is there a problem? Where does it lie? Why does it exist? What could we do about it? What should we do about it? The first two questions define the problem; the third structures the analysis; the last two find and select a solution. Chapter 8 focuses exclusively on the defining stage.

Crucially, the Problem Definition Framework also serves as a direct template for writing the Situation-Complication-Question introduction of any consulting document. Once the four framework elements are laid out, you simply read from left to right and downward, treating the last thing known by the reader as the Complication that triggers the Question. This dual function — analytical scaffold and writing guide — makes the framework especially practical.

Core Concepts

R1 (Undesired Result): The specific, unacceptable outcome the current situation produces. It is usually revealed or triggered by the Disturbing Event.

R2 (Desired Result): The specific, quantifiable outcome the reader wants instead of R1. Should be stated in end-product terms with a number or clear end state (e.g., “Reduce time to market by one-third”).

Solution: What moves things from R1 to R2. It derives from closing the gap and usually emerges from the activities or structure identified in the Opening Scene.

Starting Point / Opening Scene: The existing structure or process within which the problem emerged — analogous to the set visible when a theatre curtain rises. Often a visualizable structure (org chart, distribution network) or process (sales approach, manufacturing line).

Disturbing Event: Whatever happened — externally, internally, or as a newly recognized pattern — to threaten the stable Opening Scene and trigger the undesired result. Can be omitted in consulting proposals when it cannot be specifically identified; move directly to the R1.

Sequential Analysis: A five-step problem-solving technique (B. Robert Holland, McKinsey, 1972) that answers questions in logical order: (1) Is there a problem? (2) Where does it lie? (3) Why does it exist? (4) What could we do? (5) What should we do?

The Problem Definition Framework

Laying Out the Elements

A problem never arises in a vacuum. It emerges from an existing situation with a history. To define the problem fully, you must specify four elements:

  1. The Starting Point / Opening Scene — What is the structure or process at the heart of the situation?
  2. The Disturbing Event — What happened to threaten the stable Opening Scene?
  3. R1 (Undesired Result) — What unacceptable outcome does this produce?
  4. R2 (Desired Result) — What outcome does the reader want instead?

Exhibit 32 (page 123) illustrates this with a sales example: a company uses a tried-and-true three-step selling approach (list prospects → write script → deliver presentation). The Disturbing Event is that quarterly projections show sales down 10% instead of up 10%. R1 = threat to annual growth; R2 = continue 10% annual growth. The gap raises the question: “How can we ensure continued growth?”

The Three Questions Framework

Once the four elements are specified, the Problem Definition Framework asks:

  • What’s going on? (Situation = Starting Point/Opening Scene + Disturbing Event)
  • What don’t we like about it? (R1)
  • What do we want instead? (R2)

Multi-Layer Problems

Problems are not always single-layer. The framework can accommodate:

  • Double-layer problem: A solution was attempted but did not work. The failed solution becomes part of the Situation at the next level, and a new gap opens.

    • S = We had a problem and developed a solution | C = The solution is not working (R1-b) | Q = What should we do?

  • Triple-layer problem: Both first and second solutions failed (Exhibit 33, page 126). The history must be traced through each layer before you arrive at the current Question.

The rule for reading any layer: read from left to right and down; the last known item always becomes the Complication.

Starting Point / Opening Scene Details

The Opening Scene consists of either a structure or a process (or both):

Typical Opening Scene StructuresTypical Opening Scene Processes
Organization chartsSales or marketing activities
Computer configurationsInformation systems
Plant/office locationsAdministrative processes
Geographical marketsDistribution systems / Manufacturing processes

Sketch it simply — at the level of general knowledge a Fortune or Business Week reader would have. Write it as if telling a friend: “Once upon a time there was a company that distributed household goods around the country from three warehouses…”

Disturbing Event Details

The Disturbing Event is what happens to disrupt the Opening Scene and trigger R1. It can be:

  • External — new competitor, new technology, shift in government/customer policy
  • Internal — added a business process, installed new computer system, expanded into new market, redirected product line
  • Recently Recognized — lagging performance, sub-par results, market research implying a shift in customer attitude

If you cannot identify the specific Disturbing Event (common in consulting proposals), skip it and move directly to the R1.

R2 (Desired Result) — Stating It Specifically

R2 should be stated as specifically and quantifiably as possible, because without a precise end-product description you cannot choose among the possible solutions. Examples of good R2 statements:

  • Meet year-end growth goals
  • Reduce time to market by 1/3
  • Permit supermarket testing at reasonable cost
  • Revise the system to function properly
  • Have sufficient capacity to cope with projected demand

If you cannot state R2 specifically at first, write down the general state you want, then make determining the specific R2 the first step in your problem-solving.

Converting the Framework to an Introduction

Once the problem is laid out, translating it into an introduction is mechanical: read left to right and downward. The last thing the reader knows always serves as the Complication.

For the simple gap case (no prior solution):

  • S = We have a process we like (Situation)
  • C = It isn’t giving us what we want (R1, R2)
  • Q = What should we do?

For the case where a solution has been proposed:

  • S = We had a problem (Situation, R1, R2)
  • C = We came up with a solution (Solution)
  • Q = Is it the right solution? / How do we implement the solution?

For the case where a solution was tried and failed:

  • S = We had a problem and developed a solution (Situation, R1, R2, Solution)
  • C = The solution is not working (R1-b)
  • Q = What should we do?

Look for the Question: Seven Problem Situations

Once the problem is laid out, identify where the reader stands in terms of seeking a solution. There are seven standard situations (Exhibit 34, page 132):

Most Common:

  1. They do not know how to get from R1 to R2 → Q: How do we get from R1 to R2?
  2. They think they know but are not certain → Q: Is it the right solution?
  3. They know how but do not know how to implement → Q: How do we implement the solution?

Variations:
4. They tried a solution but it did not work → Q: What should we do?
5. They have several possible solutions but don’t know which to pick → Q: Which is the best alternative?

Also Possible:
6. They know R1 but cannot articulate R2 → Q: What should our objectives and strategy be?
7. They know R2 but are not sure whether they are at R1 (benchmarking) → Q: Do we have a problem, and if so how should we respond?

Exhibit 34 Mapping: Introduction Structure for Each Case

CaseSituationComplicationQuestion
1SituationR1, R2How do we get from R1 to R2?
2 & 3Situation, R1, R2SolutionIs it right? / How to implement?
4Situation, R1, R2, SolutionSolution did not workWhat should we do?
5Situation, R1, R2Alternative ways existWhich is best?
6Situation, R1Don’t know R2 or how to get thereWhat should our objectives/strategy be?
7Situation, R2Not sure if at R1Do we have a problem?

Important note on alternatives (Case 5): Alternatives belong in the Complication, not in the Key Line. Never bring up alternatives just to knock them down. The reason for choosing C is that it solves the problem, not that A and B are inferior.

Move to the Introduction: Seven Pyramid Structures

For each of the seven cases, the introduction and pyramid take a characteristic form:

Case 1 — What should we do?

  • S = Have X approach to selling | C = Expect much higher growth, afraid X will not continue to work | Q = How should we change?
  • Key Line: Steps to change (plural noun: “changes”)

Case 2 — Should we do what we’re thinking of doing?

  • S = May have a problem because new approach being tried in our industry | C = If so, we will have to change | Q = Should we plan to do so?
  • Variation: S = We have situation/problem | C = We plan an action | Q = Is it the right action?

Case 3 — How should we do what we want to do?

  • S = Our city has a problem | C = We have decided what the solution should be | Q = How do we implement the solution?
  • Also used to explain how something was done

Case 4 — Our solution hasn’t worked, what should we do?

  • Extension of Case 1: Problem can have double or triple-layer past

Case 5 — Which alternative should we choose?

  • S = We had a plan to implement in X way | C = Suggestion that Y might be better | Q = Which is the better way?
  • Key Line answers “Why Y is better” with supporting evidence

Case 6 — What should our strategy be?

  • S = Operating as small player in big market | C = Don’t know full potential | Q = What should our strategy be to get there?
  • Top point states the strategy; Key Line either delineates steps to achieve it or explains it with a deductive argument

Case 7 — Do we have a problem?

  • S = Major changes taking place (new market groupings) | C = Belief that changes augur ill | Q = Is that belief justified?
  • Used when a client wants to benchmark against competitors

Process Summary: Using the Framework

The five-step process for applying the Problem Definition Framework:

  1. Lay out the basic parts of the problem using the Situation / R1 / R2 diagram
  2. Identify where you are in terms of the solution (Has one been suggested or accepted?)
  3. Determine the appropriate question
  4. Check that the introduction reflects the problem definition
  5. Check that the pyramid answers the question

Real-Life Example: Retail Distributor (Exhibit 35 & 36)

A retail distributor of household goods has:

  • Opening Scene: Three distribution centers (Worcester, Evansville, Las Vegas) plus rented DMSI space; designed for 490 stores, actually serving 438
  • Disturbing Event: Volume growing 4–5%/year; 198 new stores opening by year end; will run out of capacity in 2 years
  • R1: Will run out of capacity in 2 years
  • R2: Have sufficient capacity to cope
  • Solution options: Expand present warehouses / Build 4th or 5th warehouse / Upgrade material handling / Continue third-party reliance — each with different ROI impacts

This maps to Case 5: “Which alternative should we choose?”

  • S = Three distribution centers set up to handle 490 stores, can actually do only 438 and only by using rented space…
  • C = Impact on ROI differs with activity and timing; want approach ensuring lowest capital outlay and operating costs while maintaining processing speeds and full-line strategy
  • Q = What should the distribution strategy be?

The final pyramid recommends adding capacity incrementally (to avoid building fourth warehouse as long as possible), with five specific actions across 1997–2002.

Key Takeaways

  1. A problem is always a gap between R1 (what you have) and R2 (what you want); the solution is whatever closes that gap.
  2. The four elements of a fully defined problem are: Starting Point/Opening Scene, Disturbing Event, R1, and R2.
  3. The Problem Definition Framework doubles as a writing guide: read left to right and down; the last known item is always the Complication.
  4. There are seven standard problem situations determined by how far along the problem-solving process the reader has already progressed.
  5. Alternatives always belong in the Complication — never structure a document to knock down options A and B in order to justify C.
  6. R2 must be stated as specifically and quantifiably as possible; vague desired states make solution selection impossible.
  7. The Disturbing Event can be External, Internal, or Recently Recognized; if unidentifiable, skip it and move to R1.
  8. Multi-layer problems (double or triple) require tracing the full history before reaching the current question.
  9. The framework is equally useful as a diagnostic tool when reviewing documents written by others — check that the intro reflects the problem definition and the pyramid answers the question.
  10. The Opening Scene should be sketched simply — enough for a general business reader to visualize, nothing more.

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