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December 11, 2021

How to create an effective Problem Statement

How to create an effective problem statement.

When thinking about the problem, it may help to think of the idea of a "negative outcome." People tend to jump to the idea that the "problem" is that something is missing.

Not-a-Problem Statement:

We need a technology tool to capture HR data points.

This isn't a problem statement. It's just a suggestion with no clarity about what it could improve.

Bad Problem Statement:

We don't use a technology tool to capture HR data points.

The Bad Problem Statement at least shifts toward identifying a gap, but it makes an assumption that the gap is a problem and that a tool could fix it.

Better Problem Statement:

We are unable to manage employee performance, which may be due to a lack of HR data points.

The Better Problem Statement states a potential problem before stating the assumption separately. If you think about it for a moment, you may realize that the Better Problem Statement still includes an assumption: it's bad that we are unable to manage employee performance. This is where we need to think of the negative outcome and get more specific.

Good problem statement:

It is difficult to evaluate employee performance, which may result in increased errors, higher turnover, or reduce our ability to manage improvements.

We've now tied the problem we see, some gap in evaluating employee performance, to the potential impacts. The Good Problem Statement could still be improved if we have any single measure for errors, turnover, or improvement. It could be improved further if we are able to show there has been a trend.

Seeing the negative outcomes may reveal other opportunities for intervention, especially if measures are trending the wrong way. Maybe we need more training for managers to have the right conversations with their reports. Maybe we need to do more research into why employees don't last long.

Note: When we don't have anything to track, we'll never have the opportunity to explore other interventions for a trend.

Optimal Problem Statement:

Our error and turnover rates are costing the organization $x per quarter.

Even without the ability to see trends, we can still arrive at an Optimal Problem Statement. We just need to identify that the negative outcome of an issue is tied to financial performance of the organization.

It may even be stated as an Opportunity Cost Problem.

Opportunity Cost Problem Statement:

Since we are seeing increased demand in the market, we may miss out on $x in revenues next quarter if we cannot retain and upskill our staff.


The biggest challenge people face in problem-solving is the tendency to jump to a conclusion about solving the problem. That conclusion may be partly or even wholly correct, but opportunities may be missed or new problems could be created when the problem isn't clearly identified.