Basic tools for Analytical Thinking

1. Analytical Thinking &
Creativity

2. Analytical Thinking
Analytical Thinking – Problem Solving Model
Problem
Hypothesis
FactsAnalysis
Solution

3. Analytical Thinking
Problem Solving Steps
I. Defining the Problem
II. Formulating the Hypothesis
III. Collecting the Facts
IV. Conducting the Analysis
V. Developing the Solution

4. Analytical Thinking
Defining the Problem
Definition:
• A problem is a situation that is judged as something that needs to be corrected – implies
that a state of "wholeness" does not exist
Importance:
• It is our job to make sure we’re solving the right problem – it may not be the one
presented to us by the client. What do we really need to solve?
Basic Concepts:
• Most of the problems are initially identified by our clients
• Defining the problem clearly improves focus – it drives the analytical process
• Getting to a clearly defined problem is often discovery driven – Start with a conceptual
definition and through analysis (root cause, impact analysis, etc.) you shape and redefine
the problem in terms of issues

5. Analytical Thinking
Formulating the Hypotheses
Definition:
• Hypothesis is a tentative explanation for an observation that can be tested (i.e.
proved or disproved) by further investigation
Importance:
• Start at the end - Figuring out the solution to the problem, i.e. "hypothesizing",
before you start will help build a roadmap for approaching the problem
Basic Concepts:
• Hypotheses can be expressed as possible root causes of the problem
• Breaking down the problem into key drivers (root causes) can help formulate
hypotheses

6. Analytical Thinking
Collecting the Facts
Definition:
• Meaningful information (has merit – not false) that is qualitative (expert opinions) or
quantitative (measurable performance) to your decisions
Importance:
• Gathering relevant data and information is a critical step in supporting the analyses
required for proving or disproving the hypotheses
Basic Concepts:
• Know where to dig
• Know how to filter through information
• Know how to verify – Has happened in the past
• Know how to apply – Relates to what you are trying to solve

7. Analytical Thinking
Conducting the Analysis
Definition:
• The deliberate process of breaking a problem down through the application of
knowledge and various analytical techniques
Importance:
• Analysis of the facts is required to prove or disprove the hypotheses
• Analysis provides an understanding of issues and drivers behind the problem
Basic Concepts:
• It is generally better to spend more time analyzing the data and information as
opposed to collecting them. The goal is to find the “golden nuggets” that quickly
confirm or deny a hypothesis
• Root cause analysis, storyboarding, and force field analysis are some of many
analytical techniques that can applied

8. Analytical Thinking
Developing the Solution
Definition:
• Solutions are the final recommendations presented to our clients based on the
outcomes of the hypothesis testing
Importance:
• Solutions are what our clients pay us for…
Basic Concepts:
• It is important to ensure the solution fits the client – solutions are useless if they
cannot be implemented
• Running an actual example through the solution is an effective way of testing the
effectiveness and viability of the solution

9. Analytical Thinking
ANALYTICAL THINKING TOOLS

10. Analytical Thinking
SWOT Analysis
• SWOT Analysis is a strategic planning method used to evaluate the Strengths,
Weaknesses, Opportunities, and Threats involved in a project or in a business venture. It
involves specifying the objective of the business venture or project and identifying the
internal and external factors that are favourable and unfavourable to achieve that
objective.
• The technique is credited to Albert Humphrey, who led a convention at Stanford
University in the 1960s and 1970s using data from Fortune 500 companies.
• A SWOT analysis must first start with defining a desired end state or objective.
– Strengths: attributes of the person or company that are helpful to achieving the objective(s).
– Weaknesses: attributes of the person or company that are harmful to achieving the
objective(s).
– Opportunities: external conditions that are helpful to achieving the objective(s).
– Threats: external conditions which could do damage to the objective(s).

11. Analytical Thinking
SWOT Analysis

12. Analytical Thinking
Fish Bone Analysis
The value of the Fishbone Diagram is that it provides a method for categorizing the
many potential causes of problems or issues in an orderly way and in identifying root
causes
Cause Cause
Fishbone Diagram/Ishikawa Diagram / Cause and Effect Diagram designed by Kaoru
Ishikawa is an analysis tool that provides a systematic way of breaking down an issue
in successive layers and looking at effects and the root causes that create or
contribute to those effects.
Cause
Detail
Detail
Cause
Detail
Detail
Result (Problem)

13. Analytical Thinking
Fish Bone Analysis
• The analysis starts with a problem to be investigated. This problem is
written in the form of a question on the right side of the page.
– An arrow, or sometimes a drawing of a fish head, will point to the
question under consideration. To the left of the problem statement, a
horizontal line divides the paper in two. This is the "backbone" of the
fishbone diagram.
• The next set of bones represents the most important categories of
the factors which might lead to the basic cause; the names of these
categories are written along the top and bottom of the paper, with
angled arrows pointing back to the backbone as well as towards the
head, thus forming a herringbone pattern.

14. Analytical Thinking
Fish Bone Analysis
• There are six categories that relate to manufacturing problems:
machine, methods, material, maintenance, man and mother-nature.
– There are other categories such as equipment, process, environment
and Management that are added on to this.
– Experts use several factors to analyze service and administrative
problems such as: price, promotion, processes, place, policies,
procedure and the product.
– A service industry for example would use the following factors to figure
out problems: surroundings, suppliers, systems and skills.
• This is why conventions have been developed to provide categories
to help determine the problem areas in these fields.

15. Analytical Thinking
Fish Bone Analysis

16. Analytical Thinking
Force Field Analysis
• Developed by Kurt Lewin (1890-1947) to analyse the conflicting forces in a situation.
• Problematic situations identified as a first step. The current position is represented as a
horizontal/vertical line across the middle of the page
• Driving Forces are those forces affecting a situation
that tend to have positive impact on the situation .
• Restraining forces are forces acting to restrain or
decrease the driving forces.
• All driving /restraining forces are represented as
arrows.
• Equilibrium is reached when the sum of the driving
forces equals the sum of the restraining forces.

17. Analytical Thinking
• Techniques like brainstorming may be use to identify problem and
driving/restraining forces. The final result must be a result of group consensus.
• Objective of the analysis is to:
– find ways to strengthen or add positive forces
– find ways to weaken or remove negative forces
– recognise negative forces that are too strong and abandon idea
• To prioritise steps in the action plan, may be ranked on a scale according to the
severity of their effect. There is a great deal of sophistication available to improve
the effectiveness of a force-field analysis. In particular, when considering the
relative importance of different elements, four common scales used are:
– their importance
– their influence
– their urgency
– the cost
Force-Field Analysis

18. Analytical Thinking
Force Field Analysis Example

19. Analytical Thinking
Dimensional Fact Model
• The DFM is a modeling language to represent multi-dimensional models in a concise and
easily readable form
• A fact is a concept relevant to decision-making processes. Examples of facts in the
commercial domain are sales, shipments, purchases, and complaints
• A measure is a numerical property of a fact and describes a quantitative fact aspect that is
relevant to analysis
• A dimension is a fact property with a finite domain and describes an analysis coordinate of
the fact
• Typical dimensions for the sales fact are products, stores, and dates; in this case, the basic
information that can be represented is product sales in one store in one day.

20. Analytical Thinking
Dimensional Fact Model
• A fact is represented by a box that displays the fact name along with the measure names
• A dimensional attribute is a property, with a finite domain, of a dimension
• The relationships among the dimensional attributes are expressed by hierarchies
• A hierarchy is a directed tree (derived from graph theory) whose nodes are dimensional
attributes and whose arcs model many-to-one associations between dimensional attribute
pairs
• Hierarchies define the way elemental business events can be aggregated and effectively
selected for decision-making processes

21. Analytical Thinking
Multi-Dimensional Fact model
• A multi-dimensional data model consists of a set of numerical quantities (measures)
• Value of measures depends on certain parameters defined on discrete domains
(categories)
• These domains (dimensions of analysis) are multi-dimensional space
• Analysis of events (or events of interest) quantitatively described by the measures are
conducted in this dimensional space
• This model is often illustrated as a cube whose edges are the dimensions of analysis-
• The cube is divided into many "cubes", each of which is identified by a set of
coordinates with ideal values of measures for that date term
• “Fact“ represents the occurrence of an event of interest in the domain business
(dimensional space)

22. Analytical Thinking
Cube of Sale-A Classic DFM
• The most classic example of this model is the dimensional cube sales "that
represents the space of analysis for the sales of a retail chain
• Typically the size of the test are:
– the day the sale was made
– the shop where it was sold
– the product sold
• Measures that quantitatively describe the
fact "sale" are:
– the amount of product sold
– the selling price
– the purchase price of the product sold
Quantity Sold: 10 kgs Sale Price: Rs.220/- Purchase Price: Rs.160/-
Cube of Sale
D
a
y
s
4
2
1
3
shops
1
1
2
2
3
34
4
Measure:

23. Analytical Thinking
• The elements of a dimension can be grouped hierarchically into various levels up to
compose a tree
• Each layer represents a grouping of elements of uniform size compared to their main
feature:
– the root of the tree represents the entire size
– the leaves represent its individual elements
• Groups that represent a level of aggregation (ie the elements of level) are linked to
elements of the lower layer by reports of one-to-many:
– each group one level (except the leaves of the tree) includes one or more groups under his level
• The functional link comes from the correspondence that exists between each group of
items in a level of aggregation to the group (uniquely identified) of Tier that it includes

24. Analytical Thinking
Hierarchy of territories
India
West BengalMaharashtra
K
o
l
k
a
t
a
M
u
m
b
a
i
D
u
r
g
a
p
u
r
shop1 shop2 shop3 shop4
Shops
Cities
States
Country
The character of
uniformity in the
groups of elements that
constitutes a
hierarchical level of
aggregation gives its
own identity to the
same level

25. Thank You