1.3 ORGANIZATIONAL PLANNING & DECISION MAKING:

FISHBONE ANALYSIS

HL (HIGHER LEVEL CONTENT)

DECISION MAKING TECHNIQUES(p56-65)

There are a number of techniques that may assist managers in making more effective decisions. As a HL student you must know: The Fishbone (cause & effect) diagram/ Decision Trees (probability diagrams) Force Field Analysis

THE FISHBONEOrigins

• The fishbone diagram (also know known as the Ishikawa or cause and effect diagram) attempts to identify the causes of an event.

• It gets is names from the fact that the diagram resembles the skeleton of a fish.

• The diagram was created by Kaoru Ishikawa, who pioneered quality management processes in the Kawasaki shipyards.

• He became one of the founding fathers of Japanese modern management.

THE FISHBONEAnalysis

• Fishbone analysis provides a structured way to help think through all possible causes of a problem.

• Causes in the fishbone diagram are usually arranged into four or six major categories, although this can be adapted to the individual situation.

Categories for the Fishbone

The Six Ms: Recommended for Manufacturing Goods• Manpower, Methods, Machinery, Materials,

Mother Nature (environment), Measurements

Recommended for Delivery Services• Equipment, policies, procedures and people.

Steps in the Process for Using a Fishbone Diagram

1.Identify and agree on the problem

2.Establish the major causal factors involved.

3.Identify possible causes.4.Analyze the Diagram

FISHBONE DIAGRAM PROCESS1. Identify and Agree on the Problem

• Write down the exact problem • Identify the staff involved, and when and

where the problem occurs. • Write the problem on the right hand side of

the diagram. • Draw arrow across the paper horizontally to

the problem, providing a framework to develop ideas.

FISHBONE DIAGRAM PROCESS2. Establish the major causal factors involved

• Identify the factors that may be root causes of the problem and merit further investigation.

• Draw lines off the spine for each of the factors and label the branches.

• These may include factors such as the people involved with the problem, machinery employed, methods used and materials used.

• These factors may be established using a brainstorming exercise.

FISHBONE DIAGRAM PROCESS3. Identify possible causes

• Where a cause is complex, there may be several sub-causes.

• For each root cause identified ask: why is this cause happening?

• Establish possible related sub-causes. • These are them smaller lines off the “bones” of

the fish.• The five waves technique (p64) would be useful

here.

FISHBONE DIAGRAM PROCESS4. Analyse the Diagram

• Investigate the most likely causes identified on the diagram, which may involve further, more extensive and detailed research.

• This should help clarify whether the causes are correct.

FISHBONE DIAGRAM – FOLLOWUP

• Once the diagram is completed, the business will put into action policies to address the underlying causes of the problem identified.

• For an application of the fishbone to the total quality management see p254 (textbook)

FISHBONE EXERCISE

Problem

A Business is experiencing decliningsales of its Product X

Identify possible causes of this problem and possible solutions, by completing a fishbone diagram.