What is an issue tree and how to use it?
•
12 likes•2,822 views
Issue tree is one of the most important tools used in management consulting. Issue tree is a concept that will help you guess in a structured manner the problems, reasons causing those problems and on the basis of this decide what should be analyzed. In this presentation I will show you how to build it as well as you will get an opportunity to have a look at 2 examples of applying this in practice. The first examples will be showing issue tree for chicken producer. The second example will be around Retail,
Recommended
Recommended
More Related Content
What's hot
What's hot (20)
Similar to What is an issue tree and how to use it?
Similar to What is an issue tree and how to use it? (20)
More from Asen Gyczew
More from Asen Gyczew (10)
Recently uploaded
Recently uploaded (20)
What is an issue tree and how to use it?
- 1. 1 What is an issue tree and how to use it? Practical guide with examples
- 2. 2 What is an issue tree?
- 3. 3 Bottom-up approach Top-down approach Backward logic Compounded effect Issue Tree Priorities Benchmarks 80/20 rule Opportunity Tree KPIs and business drivers Theory of constraints and bottlenecks Issue tree is one of the most important tools used in management consulting
- 4. 4 Issue tree is a concept that will help you guess in a structured manner the problems, reasons causing those problems and on the basis of this decide what should be analyzed Area of analysis Area 1 Problem 1 Problem 2 Possible Reason 1 Possible Reason 2 Possible Reason 3 Possible Reason 4 Possible reasonsSuspected problems Analysis to be performed Analysis 1 Analysis 2 Analysis 3 Analysis 4
- 5. 5 Guess in a structured manner the problems Set priorities See what you have to do to check certain hypotheses Coordinate a group of Business Analysts Show to other the whole picture Not to get lost in analyses you do It helps you do a lot of things….
- 6. 6 Let’s have a look at examples of issue trees
- 7. 7 We will start with an example of logistics in a chicken producer…
- 8. 8 Have a look at an issue tree example for a chicken meat producer. We guess that he has 3 problems in Logistics Area of analysis Transport High costs of transport per ton of goods Big level of waste and breakage in transport Possible reasonsSuspected problems Analysis to be performed Low usage of resources
- 9. 9 Then for those problems we try to guess the reasons causing them Area of analysis Transport High costs of transport per ton of goods Big level of waste and breakage in transport Possible reasonsSuspected problems Analysis to be performed Badly designed routes Too big fuel usage No shipments on the way back Low usage of resources Badly designed method of packaging which makes the product prone to damage Speed not adjusted to the product Badly organized work and schedule of deliveries Limitation on delivery time of finished goods
- 10. 10 Finally we come up with analyzes we have to carry to prove or disprove these hypotheses (that certain reason is causing certain problem Area of analysis Transport High costs of transport per ton of goods Big level of waste and breakage in transport Possible reasonsSuspected problems Analysis to be performed Analysis of correlation between type of packaging and percentage of damaged Analysis of time spent on the way and kilometers covered in that time Analysis of designed routes, their length and the influence of possible changes Analysis of fuel usage and kilometers covered by vehicles Analysis of load carried on the way back Badly designed routes Too big fuel usage No shipments on the way back Low usage of resources Badly designed method of packaging which makes the product prone to damage Speed not adjusted to the product Badly organized work and schedule of deliveries Limitation on delivery time of finished goods Analysis of level of overtime, daily organization of drivers work Analysis of Clients’ preferences on delivery time
- 11. 11 Now let’s have a look at an issue tree for a Retailer….
- 12. 12 Retail chain development Product Range / Category Range Management Pricing Logistic / Supply Chain Expansion model In-store process HR especially trainings When you are talking about Retail you should have a look a the following areas
- 13. 13 Area of analysis Retail chain development Low growth in sales Decreasing EBITDA of new stores Possible reasonsSuspected problems Analysis to be performed Analysis of rents vs comparable competition Salaries growth vs rotation – comparison with competition Analyze the change in sales after opening new stores / on-line introduction Analysis of number of openings vs availability of new places Low LFL due to cannibalization (on- line, new stores in old locations) Few new openings in locations Increasing rents due not proper usage of purchasing power Growing salaries to keep low rotation High cost of building new stores No support from the shopping malls Not optimized formats, expensive fixtures Analysis of contracts with shopping malls Analysis of cost per 1 sq. m, number of fixtures, cost per fixtures Below you can see example of issue tree in Retail Chain Development
- 14. 14 Area of analysis Product Range Management Low margin on Category A Low margin on Category B Possible reasonsSuspected problems Analysis to be performed Analysis of whom we buy from Category B and the whole value chain Analysis of planning and allocation process Analyze of number of suppliers and their share in sales vs market Analysis of Private Labels potential – benchmarks and potential supplier Too many supplier of Category A that undermines your purchasing power Lack of Private Labels Usage of middlemen instead of direct suppliers Improper planning and allocation by stores High inventory cost Improper planning and allocation by stores Non-responsive supply chain Analysis of planning and allocation process Analysis of lead times, deliverability on- time, level of breakage Below you can see example of issue tree for Retail where we cover Product Range Management
- 15. 15 If you want to check more management consulting techniques check my online course with loads of examples Click to check my course How to become world class Business Analyst? Cases in Excel $190 $15
- 16. 16 Check what course will help you to be word class Management Consultant Top 10 courses that every Management Consultant should take My super objective view presentation
- 17. 17 There are also some books that I highly recommend Top 25 books that every Management Consultant should read My super objective view presentation
- 18. 18 Subscribe to our channels: www
- 19. 19 If you want to check how in practice to manage a consulting project a would recommend my presentation How to manage a consulting project? A practical guide presentation
- 20. 20 You can also find some useful tips on Excel Business modeling of offline businesses in Excel A practical guide presentation
- 21. 21 You can also find some useful tips on Excel Retail for Business Analysts and Management Consultants A practical guide presentation
- 22. 22 You can also find some useful tips on Excel Essential Excel for Business Analysts and Consultants A practical guide presentation
- 23. 23 Check my extensive presentation on productivity hacks to see how you can me 10x more productive Management consultant productivity hacks How to be lazy and still get things done presentation
- 24. 24 Check my presentation on market research methods to understand them properly Market research Practical guide for startups and entrepreneurs presentation
- 25. 25 Check my presentation other presentations Essential Lean Manufacturing for Management Consultants Practical guide how to cut costs presentation
- 26. 26 You can also have a look at how to create a financial model in Excel Financial Modeling for Business Analysts and Management Consultants Step by step guide presentation
- 27. 27 Check also my other presentations Management Consulting Presentations Practical guide how to prepare a great presentation presentation
- 28. 28 Check my presentation that will help you get into consulting How to get into consulting Practical guide how to pass the case part presentation
- 29. 29 I recommend also looking at some techniques to improve your business. Click on the cover below to go to the presentation How to become world class analyst A practical guide presentation
- 30. 30 Check also my other presentations Management Consulting Presentations Practical guide how to prepare a great presentation presentation
- 31. 31 Check also my other presentations Production for Management Consultants Practical guide presentation
- 32. 32 Check also business modeling in Excel Business models Practical guide for startups and entrepreneurs presentation
- 33. 33 Check my presentation on starting and running consulting company How to create management consulting presentations? A practical guide presentation
- 34. 34 Check my extensive presentation on productivity hacks to see how you can me 10x more productive Management consultant productivity hacks How to be lazy and still get things done presentation
- 35. 35 If you need more detailed version on productivity hacks you can check our course on productivity hacks Click to check my course Management Consulting Productivity Hacks $45 $15
- 36. 36 Check my presentation on restaurant business model to understand it properly How to open a successful restaurant A practical guide presentation
- 37. 37 Check my presentation on on-line models to understand them properly On-line Business Models A practical guide presentation
- 38. 38 For more check also my on-line course Click to check my course On-line Business Models in Excel – Practical Guide $45 $15
- 39. 39 Check my presentation on starting and running consulting company Start and run consulting company A practical guide presentation
- 40. 40 There is an interesting summary of ways to test cheaply businesses MVP – how to test your business idea without building the product A practical guide presentation