Problem Statement Examples in Business

There is no document that would require us to formulate a task our project will solve in a short and clear way. However, any communication with stakeholders demands a clear and intelligible answer to the question: what and why we are doing. Let’s see how the problem statement examples in business could help you not to fall.

Deciding if the change is needed

Basically, it is about the motive – why do we need these changes. The task of the stakeholders who we communicate with at the initial stage is to decide whether we are going into this project.

Will there be a project and why do we need it?

There are several options here.

The first option starts with the fact that there is a problem. The problem is some kind of pain point that causes inconvenience.

The next step is to understand who is affected by this problem: people who are significantly uncomfortable with its existence.

Then we have to define the influence of the problem, in what these inconveniences are expressed. It is very important that there is a certain connection between the people who make the decision and those who are affected by this problem. If there is no such link, it is unlikely that the decision to start the project or the decision required to get the project forward will be made.

The last part is formulated in the language of the subject area – what characteristics should the solution have in order for stakeholders to consider that the problem has been solved and, accordingly, the project has been completed successfully.

Problem Statement

Thus, we get a very simple formula that sounds like this:

• What is the problem?
• Whom does it affect?
• What is the impact on the people it affects?
• What are the criteria for success and what characteristics should the solution have in order for us to consider that the problem is solved?

That is, the formulation of a problem is not really a formulation of a problem, but a task. Accordingly, there is a second version of it.

Opportunity Statement

The second option of the task formulation proceeds from the fact that we are now doing well and we have an opportunity. And then the wording looks like this:

There is a certain opportunity that affects certain stakeholders, as a result of which they can receive some benefits, and in order to obtain these benefits, it is necessary that our solution has certain characteristics.

If we formulate the task not from “pain” (problem), but from the possibility, the questions will look like this:

• What is the opportunity?
• Who does it affect (stakeholders)?
• What happens as a result?
• How would a successful solution look like? 

And so, we can formulate the task as a problem (when we solve some problem and eliminate some negative phenomena), or, conversely, as an opportunity to do something.

Subtotal. Problem statement:

1. It is always done in the language of the subject area because we do it primarily for interaction with stakeholders.
2. It gives a comprehensive explanation of why we are going to do this project.
3. And, as a general recommendation, it should not take more than half of A4.
4. Thus, we get a beautiful and effective executive summary, which is enough to read to decide whether to start or continue a project.

Business Example. Identification technology and printing

An interesting example of the good and bad problem statement can give us ideas for combining identification technology and printing media.

Actually, the technology is no longer new. We know that there are already quite a few devices on the market that allow you to identify an employee when working with devices.

When these devices first appeared on the market, most people perceived them as a solution to the following problem:

Problems with the employees printing information that is not related to work issues affect the management of the company, as a result of which the company’s resources are wasted inappropriately. A successful solution must provide control over the documents that employees print using office printers.

With this formulation of the task, the project to install these devices almost always ended in failure. It used to end before it even started. When you think about the cost of the issue, the cost of all consumables per year is quite a small amount compared to the cost of the printer itself. This project will pay off in 2-3 years at best. In addition, there are other options to ensure that employees do not print unnecessary documents.

If there was no good formulation of the problem that could initiate a project with such devices, they would not have been successful in the market.

The problem that these devices solve is related to the fact that a significant period of time elapses between sending to print and the time when the employee takes the printed copies from the device.

Anyone who has been in a large office has had to rake through materials printed by others at least once. This often happens if we arrived a little later, or if someone was distracted and could not pick up their copies on time.

The main task of such devices is to make sure that only the one that printed the document can pick it up.

How does the problem statement sound now?

The problem of possible unauthorized access to printouts affects business owners and company management since the information that is a trade secret can leak and create risks up to the loss of a business or some kind of market. A successful solution must provide authorized access to the information sent to the print.

Actually, the criteria for the success of the solution could be left with the same wording: a successful solution should provide control over the documents that employees print on network printers. At the same time, the general idea and technical implementation would not change, but the perceived value of such a project changes radically.

It is aimed at preventing unauthorized access to information with commercial secrets that such projects are being implemented.

Using multiple task definitions

When working with the formulation of a task, a situation often arises when either at the stage of elaboration or as a result of a very large number of clarifications (not so much as from fundamentally different groups of stakeholders), we are forced to work with several formulations.

This technique is called problem field formation. Its essence is very simple: groups of interested parties are identified, and for each of them its own formulation of the task is formed.

In a situation where the task is still to choose a general idea of the project goal and scope, you need to understand how to formulate the problem in such a way that it sounds correct for each of the stakeholders.

Subtotals. The problem field tool can be used:

• to select one definition from their list of possible problem formulations;
• to work with presenting the same problem to multiple stakeholders.
• to describe from different perspectives what the project does for different stakeholders.

The ability to immediately take out of scope some of the primary requirements allows you to work more efficiently with the pool of requirements.

When a specific user or customer requires something from the system, then for the interested person himself there is no criterion on the basis of which he can decide to leave this requirement or drop it. But, when there is a statement of the problem, and we can manage the priorities of requirements, linking them to specific functions, we can avoid unnecessary requirements or requirements that will not lead to a meaningful result.

One project – one task statement. Interdependencies between parts of a project usually indicate a common goal.

Best Problem Statement Examples in Business

The best practice in this area is that one project should have one problem statement. If different tasks that we solve are nevertheless placed in one project, there is a significant relationship between them. This means that there is such a formulation of the task, which would cover together these tasks of the project.

As a result of business analysis, we can come to a decision to initiate not one, but two or more projects. Then unrelated or slightly related clusters of factors and primary needs can be grouped into projects that will be initiated separately.

Sometimes the results of a business analysis lead to a program. The execution of the program starts with project 1, continues with project 2, but it is impossible at the current stage to determine what the total number of projects will be. This is what is called “to eat a whale in chunks“.

For a deeper analysis of problems, as a rule, various business modeling techniques and specialized systems dynamics tools are used. These can be the current reality tree, the so-called “thunderclouds”, decision trees, and so on. But sometimes our task is to provide our project with a minimum working set of tools that will allow us to achieve a good result.

Summary

The problem statement is an important business communication tool as the decision of whether to launch a new project or not often depends on the information contained in the statement. We distinguish the problem statement of an actual pain point and the opportunity statement. We learned from the example that the proper task formulating process allows us to see the bigger picture and cure the disease instead of symptoms. 

For the cases when we have numerous stakeholders related to the project, we use the tool called problem field which implies developing a special problem statement for each side. Moreover, the business analysis can lead to a chain of projects aimed at solving one or several problems. And despite the fact that there are many advanced approaches, from time to time applying the very simple and working ones is enough.

Here are previous posts from the Startup series, so if you have passed them through – it could be also interesting:

• Stages of Startup Funding – A step-by-step guide 
• What is startup capital? 
• Typical Startup Equity: structure, employees, percentage 
• Role of CEO in a Startup – The complete list of traits 
• Financials for a startup 
• How to valuate a Startup?