Diagnosing Problems at Work: Find Root Causes

This article is an excerpt from the Shortform summary of "Principles: Life and Work" by Ray Dalio. Shortform has the world's best summaries of books you should be reading.

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How does diagnosing problems work in the workplace? Why is it important to diagnose problems and solve them effectively?

Diagnosing problems is an important part of Dalio’s 5 steps. When you recognize and diagnose problems, you can learn how to go about finding solutions.

Learn how diagnosing problems works, and how you can do it.

Diagnosing Problems: Identify Problems and Don’t Tolerate Them

It must be OK to make mistakes, but unacceptable not to identify them or learn from them.

  • People need to internalize the Life Principles around embracing reality. People need to embrace their pain as a growth opportunity, and reflect on what they have to improve.
  • Celebrate finding mistakes since they’re opportunities to improve the machine..
  • Don’t fire someone for making an honest mistake—this incentivizes hiding mistakes.
  • Do fire someone for hiding a mistake.
  • People must escalate responsibilities they cannot handle.

Have as many people looking for problems as possible. 

  • Specifically assign people the job of finding problems. These people should report problems to people other than their direct manager, so they can report freely without fear of being punished.
  • Laws are weak unless you have auditors to enforce them.
  • Welcome other people to probe you for problems.

Probe deep and hard for problems.

  • Managers should “taste the soup” like chefs do before dishes go out. They should inspect the outcomes themselves, or have someone else in the machine responsible.
  • Have regular standing meetings to avoid interactions slipping through the cracks. Standardize the agendas with the same questions.
  • Dalio likes daily updates, asking his direct reports to write a 10-15 minute update on what they did that day, any issues they encountered, and reflections.
  • You should personally probe to the level that is two levels levels below you. This is the only way you’ll tell how well the person reporting to you functions as a manager.
    • Have them feel free to escalate problems to you, instead of requiring them to stop at their direct manager.
  • Make the probing transparent to increase the probability of being right (to let others evaluate) and reinforce faith in due process.
  • Pull all suspicious threads. Small problems can be symptomatic of serious underlying problems.
    • Imagine your small problems are pieces of trash you’re stepping over to get across the room. They may not be critical issues, but cleaning up reinforces a culture of excellence.

Be very specific when describing problems.

  • Don’t generalize. Don’t use “we” and “they.” Name specific people and specific instances. Someone made a bad decision.

Use the 80/20 rule to find the 20% of causes that lead to 80% of the problems.

No problem is too difficult to fix. Some people avoid problems because they seem too difficult. This will only worsen the situation and lead to more work later.

  • In this step, don’t worry about fixing the problems. Just identify them.

Beware of these barriers to finding issues:

  • Boiling frog syndrome: with exposure, people get used to problems that would shock them if they saw them with fresh eyes.
  • Groupthink: don’t assume that just because other people aren’t screaming about a problem means that there’s not a problem. Other people are probably thinking the same thing you are, but no one wants to speak up.

Keep an error log to track mistakes and solutions. Then observe patterns of mistakes to see if they are signals of actual weaknesses.

Find Root Causes

When solving problems, a common mistake is to deal with problems as one-time events, rather than diagnosing problems with the machine. If you don’t fix the root cause, the problem will keep occurring again and again.

Get to the level of what it is about the people involved that led to bad outcomes. Root causes are described in adjectives, not verbs. Someone could be “careless,” “not well trained,” or “has low bandwidth.” In contrast, “he forgot to write a reminder” is not a root cause.

Here’s a checklist of questions to ask for diagnosing the problem:

  • Was the outcome positive or negative?
  • Who was the responsible party in charge of the outcome?
  • Did the responsible party lack ability or skill, and/or is the design of the machine bad?
  • How should the machine have worked?
    • Stay at the level of the machine (who should be doing what), rather than getting bogged down in procedural details.
    • Go back before going forward. Reflect on how the machine was working up until now. Tell the story of how we got here.
  • If the machine didn’t work, what broke? This is the proximate cause.
  • Why didn’t things work as planned?
    • Ask Five Why’s to get at deeper causes.
    • Pinpoint a specific key attribute (for example, Thomas does not execute well, or Thomas does not perceive problems quickly.)
    • If this attribute is fixed next time, will the bad outcome still occur?
      • In other words, if we fixed this part, would that prevent the problem?
    • If the problem is a faulty design with the machine, ask who was responsible and whether they’re capable of designing the machine well.
  • Does the root cause a have pattern? Does it show repeatedly?
    • This is the difference between “Thomas was careless” to “Thomas is often careless.”
    • If it is a pattern, is this due to bad training or lack of ability?
  • How should the people/machines evolve as a result?
    • Who should do what differently?
    • Do responsibilities need to be clarified?
    • Do machine designs need to be reworked?
    • Do people’s fit need to be reevaluated?
    • Were principles violated? Are new principles needed?

Remember that this type of questioning will upset people, and they may protect themselves in a number of ways, like fixating on details instead of lack of ability.

Remember that diagnosing problems should lead to improvements and outcomes. Otherwise it’s just a waste of time.

Stay calm and rational. Don’t overreact to a mistake or problem.

  • Avoid Monday morning quarterbacking—don’t evaluate a decision with limited information.
  • Understand the context the person was in. Was this decision a quality person would have made? Did they do the right things, but the outcome was out of their control?

Here are common root causes of problems with managers:

  • They are too distant from their reports.
  • They have problems detecting bad quality.
  • They have gotten accustomed to how bad things are (the boiling frog syndrome).
  • They can’t admit they’re unable to solve their own problems, and they don’t escalate.
  • They fear being punished for admitting failure.
  • They fail to delegate their responsibility. They focus more on doing the tasks than on operating the machine.

Example of Root Cause Analysis

Problem: The team deals with emergencies constantly and has to work overtime.

Why? Because we don’t have enough bandwidth to fix the issues that cause the emergencies.

Why? Because the manager did not anticipate the problems and request more headcount to fix it.

Why? Because the manager is bad at planning for bad cases. (Root cause)

Now that you know all about diagnosing problems, the next step is finding solutions and solving problems in the workplace.

Diagnosing Problems at Work: Find Root Causes

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  • How Ray Dalio lost it all on bad bets, then rebounded to build the world's largest hedge fund
  • The 5-step process to getting anything you want out of life
  • Why getting the best results means being relentlessly honest with everyone you work with

Carrie Cabral

Carrie has been reading and writing for as long as she can remember, and has always been open to reading anything put in front of her. She wrote her first short story at the age of six, about a lost dog who meets animal friends on his journey home. Surprisingly, it was never picked up by any major publishers, but did spark her passion for books. Carrie worked in book publishing for several years before getting an MFA in Creative Writing. She especially loves literary fiction, historical fiction, and social, cultural, and historical nonfiction that gets into the weeds of daily life.

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