Two TYPES OF PROBLEMS

" There are two problems: (1) Problem of today & (2) Problem of tomorrow for a company to survive and stay in the business"
Edward Deming- Out of the Crisis 2004.

Deming the famous quality and management guru wrote in his book " Out of the Crisis" about two problems faced by any organization. It is our humble opinion that this assertion hold true to this day. 
We would like to assert that organizations face TWO TYPES OF PROBLEMS.

PROBLEM TYPE 1-PROBLEM OF TODAY

Problem of today encompasses maintenance of process quality to ensure  commitment to customer of providing quality product and services are met.
From the perspective of ISO 9001:2015, this problem can be labelled as Risk to the organizations.
This problem may lead to risk of raising customer dissatisfaction and customer purchasing from other suppliers.
Some of the problems that can contribute to Type 1 are:-

• Equipment Breakdown
• Wrong Order delivered
• Defective Products
• Delay in Delivery
• Inspection Failure

Problem Type 1 can be categorised further as Minor and Major/Critical. 
Minor problems are those detected and fixed in a short period of time, will have minimal impact on business operating performance and also meeting customer commitments. This problem is likely to be managed by the person directly involved in the process.
Major/Critical problems are those that have significant impact on the business operating performance and also delay in meeting customer commitment. This problems will include high percentage of defects, frequent breakdown, increase in cost of quality and etc. This problems are typically managed at supervisory and managerial level and will include cross-functional approach.

MINOR TO MAJOR

There is likely for minor problems to become major, if it is not managed systematically. Front-line operators should be trained to do quick root cause analysis using 5-Why technique to develop solutions that will go beyond symptom.
A Three Step Problem Solving Framework is recommended.

• Define the problem
• Find the Root Cause ( Use 5Why)
• Develop solutions and record the outcome

​PROBLEM TYPE 2-PROBLEM OF TOMORROW

Problem of tomorrow is about staying above competition, by continuously improving its systems and processes to provide improved customer value.
​From the perspective of ISO 9001:2015, this problem can be labelled as Opportunity to the organizations. It is about the organization to continuously finding ways to improve providing value to customers, hence keeping competition away from their clients. It is also an opportunity to acquire new clients.

Why is this called a problem?

If the organization do not continuously improve and innovate its offers, it may be out of business. Competition in any industries are great and competitors are consistently looking for ideas to offer better products that will either increase usage benefit or reduce sacrifices to be made customers. Hence this is considered a problem.

Two Categories

Business take two approaches to manage Type 2 problem.
Approach one is to improve efficiency and effectiveness of current processes. Faster delivery, shorter cycle time, quality output at almost zero defects are some examples. This is called incremental improvement and also can be called kaizen.
Second approach is through creativity to develop innovative products or services. This improvement is called breakthrough improvement.

SUMMARY

In the graph above we have illustrated the improvement cycle that every organization must go through. Failure to address both problems will lead to disastrous outcome to the survival organization, especially in the present era when innovation in processes and products are happening rapidly.