iSixSigma

Case Study: Using the 5 Whys to Validate Assumptions

The effectiveness of any process improvement tool depends on the process improvement practitioners’ assessment of the situation, choice of the simplest tool and the creative use of the tool. This article provides an example of how a simple tool, the 5 Whys, was used to unearth an assumption embedded in a business process. Once the assumption was revealed and tested with data, impressive results ensued.

The 5 Whys is an iterative question-asking technique to identify the root cause underlying a particular symptom. Consider a situation in which a child throws a tantrum and refuses to go to school. Table 1 shows the application of the 5 Whys to this situation.

Table 1: Example of 5 Whys – A Child’s Tantrum

Why

Answer

Why #1Why does the child throw the tantrum and refuse to go to school?The child says, “I feel warm.”
Why #2Why does the child feel warm?The child has a body temperature of 101 degrees.
Why #3Why does the child have a body temperature of 101 degrees?Yesterday, the child did not wash his hands before eating dinner in a restaurant. In addition, many of his classmates have been coughing.
Why #4Why did the child not wash his hands?The parent gave up trying to convince the reluctant child to wash his hands.
Why #5Why did the parent give up trying to get the child to wash his hands?The parent did not want to feel embarrassed by the child’s behavior.
Why #6*Why would the parent feel embarrassed?The parent was raised to believe that you should not cause a scene in public.
* Note: Sometimes it take more than 5 Whys in order to reveal the root cause of the situation.
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The deeper the questions of “why” go, the more likely that the root cause of a situation will be revealed. In this example, the parent needs to address the situation – the child’s temperature needs to be brought down. The root cause, however, is how a parent manages themselves during the power struggle. In this case, the way the parent was raised is not something that the parent can change. But awareness of the underlying assumption means it can be questioned or changed.

Case Study: Large West Coast Marina

Attendants at a large West Coast marina had been complaining about the time-consuming nature of the process for collecting fees for short-term moorage (i.e., parking for boats) – it took time away from other activities that were potentially more profitable for the marina. Through the marina’s strategic planning, this process was targeted for improvement.

Originally the daily process for collecting short-term moorage fees took 12 hours and included four major steps:

  1. Boaters write the boat name, number and moorage space number on a marina-provided envelope, enclose the fees, and drop it in a deposit box.
  2. A moorage attendant picks up all of the envelopes twice a day. The counter attendant processes the contents and inputs all envelope data into the payment system. This step takes approximately two hours per day.
  3. Twice a day, an attendant walks the docks and writes down all of the boat names, numbers and moorage space numbers on a form and takes the form to the counter attendant for input into the payment system. This step takes approximately 10 hours per day.
  4. Invoices are automatically sent to boaters for collection discrepancies in moorage usage fees on a monthly basis.
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The moorage attendants informed marina management that there was a lot of data entry duplication – the same data is recorded on paper and then entered into a payment system. They learned that other marinas equipped their attendants with a handheld device for inputting all boat information, which is then uploaded by the office attendant into the payment system. Marina management budgeted $100,000 for the implementation of this automated system and engaged a third-party company to 1) document the as-is and to-be processes, 2) write a business case to justify the investment and 3) produce a business-requirements document for the implementation.

Current State

When the consulting company began to document the current state, the activity of sending invoices to boaters (Step 4) for short-term moorage stood out. This type of activity is not normally seen in the similar situation of short-term parking for cars. The consultant suggested that exploring this approach to invoicing would be worthwhile before moving forward with the technological solution. The client agreed; the consultants partnered with the attendants to learn more about this process.

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Why Send Invoices

The project team used the 5 Whys to discover why the activity of sending invoices to boaters was performed in the first place. The situation: Monthly invoices are automatically sent to boaters for collection of any discrepancies in moorage usage fees.

Table 2: The 5 Whys – Sending Automatic Invoices for Fee Discrepancies

Why

Answer

Why #1Why are the boaters sent a monthly bill for moorage usage-fee collection discrepancies?The boaters used the facility so they need to pay for their use of the facility.
Why #2Why does the marina need to ensure boaters pay for usage?The marina is a public facility and all usage fees must be collected on behalf of taxpayers.
Why #3Why does the marina need to ensure the collection of all usage fees on behalf of taxpayers?Because if the marina does not collect the fees, the boaters will use the facility without paying for it.
Why #4Why would the boaters use the marina and not pay?There is no incentive for them to pay if they can get away with using the facility without paying.
Why #5Why would the boaters not pay even if they can get away without paying?The boaters cannot be trusted. This is why in comparable situations, there are train conductors walking around collecting tickets and parking lot attendants checking payments in payment boxes against cars in the parking lot spaces.

Validating the Assumption

The underlying assumption is that boaters cannot be trusted and that given the opportunity, the short-term moorage users will either purposely not pay or underpay their daily moorage fees. Many of the activities within the fee collection process were established to ensure that all of the fees were collected. The consultants asked the operational team to test this assumption with data and created a standard form for them to use.   The marina team went back through its records for the past two years and discovered that 99.5 percent of moorage customers voluntarily paid their moorage fees; the average underpaid amount was 54 cents. The team also learned that customers often overpaid because they did not have exact change. The team concluded that it was not cost effective to spend $300 a day to chase an average of $2.60 a day.

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Before and After Process

Table 3: Moorage Fee Collection Process – Before and After

Step

Before

After

Savings

1

Boaters write the boat name, number and moorage space number on a marina-provided envelope, enclose the fees and drop it in a deposit box.

No change

N/A

2

A moorage attendant picks up all of the envelopes twice a day. The counter attendant processes the contents and inputs all envelope data into the payment system. This step takes approximately two hours per day.

No change

N/A

3

Twice a day, an attendant walks the docks and writes down all of the boat names, numbers and moorage space numbers on a form and takes the form to the counter attendant for input into the payment system. This step takes approximately 10 hours per day.

Eliminated

$290/day (hourly rate x 10 hours)

4

Invoices are automatically sent to boaters for moorage usage-fee collection discrepancies on a monthly basis.

Eliminated

$10/day (average 10 mailings/day x $1 per mailing)

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Results

For a $5,000 investment of consulting and staff time, the return on investment was outstanding.

  • The marina redirected 10 hours per day to customer valued activities that were previously performed with staff overtime.
  • The marina withdrew the decision to make a $100,000 capital investment on a technological solution.
  • The marina eliminated the mailing of monthly invoices.
  • These simple changes led to a total hard savings of $200,000 in the first year and $100,000 in the following years. The soft saving was a much happier moorage staff.

Will These Results Last?

A question surfaced during the improvement process: Two years of data showed that 99.5 percent of moorage customers voluntarily paid their moorage fee and the average underpaid situation was 54 cents – but how can the marina be certain that this situation will continue? That the results will be sustained? The consulting company facilitated a solution in which the marina established a monthly audit to verify that the numbers continued to meet expectations. Attendants will randomly pick 20 boats and confirm whether those 20 boats made their fee payments. If there is an increase in the number of “no payments” or “underpayments,” then a reassessment will be undertaken.

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Comments 12

  1. kavs

    Excellent method of getting root cause analysis with cause and effect tool

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  2. Name (Required)

    Good article. Thanks.

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  3. Aaron W

    Great article, Jerry! There can never be too many reminders for us to go back to basics. Even as problems become more complicated, breaking down to the simplest components is still an effective analytical methodology to use. IMHO, a completely executed 5-why approach forces honest evaluation down to the core cause. However, more often than not, impatience and false assumptions DO get in the way of completing this approach to its final cause. Not a failure of the approach, but of the practitioner. I too am guilty of this, so I especially appreciate the reminder!

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  4. Al N

    Bravo! A well-explained demonstration identifying the root cause via getting to the core underlying assumption, testing its validity, and developing a straightforward business solution that makes sense and is sustainable. Thank you for sharing this.

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  5. Diego Salazar

    That´s really the simple method to analyze the real reason for the problem, i think this method is the first step in the process, thanks for the article and the example

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  6. Zhou Yin

    Very simple and useful tool for everyday work and life. Sometimes we have some ideas on the back of our mind. But this method can definitely help with getting consensus and convince the team, either at home or at work.

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  7. M

    Well-articulated and thorough case study on extracting the root cause of a problem via the 5 Whys method. Great article.

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  8. TS

    Breaks down assumptions to its roots – very well written and straightforward. I look forward to reading more!

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  9. Neri Reyes

    Where was applied this methodology?
    Where in the world? In that country?

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  10. Anuj

    Wonderful article. explained in a very simple way. Thanks for sharing

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  11. Ranjit Kumar

    Thanks for providing real time case study.

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