Think Better Example from Tesco Business Problem
Critical Thinking on Business Situation and Better Problem Analysis
Feb 23, 2009
Tesco launched US Fresh & Easy outlets in November 2007 based on research into the West Coast grocery market. William Kay's Sunday Times article Tesco Admits: We got it wrong in US quotes Tim Mason, head of Tesco's US business: "We may have assumed that certain elements of the Fresh & Easy brand would do the work for us and we would not have to go down and dirty on price. That may have been a mistake."
Tesco Action
The article goes on to note that during a customer focus group meeting one individual stated that they stopped shopping at Fresh & Easy because they no longer received a flier about special offers. The reaction by Tesco was apparently "we had better make sure we hit everyone in the area with fliers."
Think Better Example about Business Problem
The situational analysis and intended action is apparently superficial but it should be noted that the article may not be fully representative of all of the facts. However, for the purpose of this how to think better example about the business problem it is assumed that:
- Tesco has experienced a slowdown in sales at Fresh & Easy
- The business problem or sales situational analysis was through a customer focus group
- Focus group included one comment that linked lack of buying with stop of fliers
- Remedial action to restore buying is by restarting fliers
Critical Thinking on Business Problem
Critical thinking on business problem would attempt to identify and validate cause and effect relationships. This would lead to some of the following questions:
- What facts are available at the slowdown sales? Is this store or area specific?
- What opinions and extrapolations have been drawn from those facts?
- Is the customer feedback representative of other anecdotal or quantitative measures?
- Given customer focus feedback and linking sales to fliers is there evidence to support this?
- What is the impact of the slowing economy? Is it possible to explain the sales slowdown on that factor alone?
- If there is evidence that the distribution of fliers impacted sales is that the major factor?
These questions and similar would form the basis of a thorough situational analysis with the intention of both identifying and validating the causes and effects.
Critical Thinking
Essential to this thinking process of critical thinking is separating statements into:
- Facts - what are the incontrovertible facts and what are the potentially controversial facts
- Opinion - what is an opinion that may have validity or express some insight
- Extrapolation - what is some logical extension to a fact or opinion
Opinion and extrapolation are both likely to be untested assumptions. A controversial fact is likely to be an extrapolation or some interpretation of facts rather than a simple statement of fact. Using this information it becomes clearer what is fact and what is an untested assumption.
Think Better
To think better about a business problem is to apply critical thinking to a situation, to understand what is fact and what is opinion, to find untested assumptions, to identify and validate cause and effect relationships. To think better does not require any particular thinking model but they may help such as Use Theory of Constraints Thinking Processes.
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