Problem is always considered negative if not given a solution at the early stage. The negative impact it creates to the firm affects the bottomline ("Net Profit"). Most often the negative effect to company's performance is dependent on how the trouble shooters and strategist come up with solutions.
Herbert A. Simon, a Nobel prize-winning management scientist, is credited with defining four basic phases of problem solving that are universally recognized. The following are the phases of problem-solving:
- Intelligence Activity. Searching the environment for conditions calling for a solution.
- Design Activity. Inventing, developing, and analyzing possible courses of actions.
- Choice Activity. Selecting a particular course of action from those available .
- Review Activity. Assessing past choices.
In understanding these problem-solving phases, please relate these to the flowchart above.
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