“Problem-solving” is one of the most overused and least understood phrases in the business world. When many people talk about solving problems, they are rarely talking about a problem-solving process. Instead, they are talking about making the problem disappear, regardless of their own ability to actually “solve” the underlying problem.
Consider this example:
Imagine you want to get a single apple from a tree. You could cut down the entire tree and then pick the apple. Or you could use a ladder to reach the branches and then pick the apple. Either way, you’ll get an apple. But the first approach will cost you much more time and energy (not to mention, the tree itself).
It sounds crazy, but many people end up using an approach analogous to cutting down the entire tree when faced with a problem. They focus on actions like analyzing data or building Excel models instead of thinking about how they are going to solve it.
What I got wrong about problem-solving
What are the most important skills you need to be successful?
Communication? Working well with others? Organization?
If you had asked me this question when I was in college, or even after I had worked for a few years, I probably would have given one of those answers. Effective communication tops a lot of lists (it is even the answer I got when I asked ChatGPT this very question). But, after nearly a decade of working in consulting and teaching consulting skills, I’ve come to believe that problem-solving is the most important skill.
But what is problem-solving? It is a term that means different things in different contexts. From a psychological perspective, it’s a cognitive process in which a person uses mental strategies to achieve a goal or find an answer to a challenging situation. From an education perspective, it’s a method where students are encouraged to use critical thinking and reasoning to solve problems given in a textbook or a test.). In rock climbing, it means creatively finding your way forward on your route.
More simply, problem-solving is an intentional approach to arriving at some kind of answer. It is asking, “What should we do next?”
When I joined McKinsey, I was struck by how often the term “problem-solving” was used. Instead of being called “meetings,” teams met for what were called “Problem-solving sessions.” These were focused sessions designed to work through specific questions or challenges as part of a broader client engagement.
But these weren’t just another fancy name for meetings. They were a constant reinforcement of the underlying culture of the firm: one obsessed with the process of ongoing problem-solving. Over time, I internalized the key assumption behind it all: how we approach our work is the most important thing in all the work we do.
Why is problem-solving at the core of consulting?
Before I started at McKinsey, someone several decades my senior asked me “why would my company hire you, with only a few years of work experience, to solve a problem for us?” He was skeptical of how a team of twenty-something analysts and associates could address problems that his senior leadership team was struggling with.
It’s a fair question. In consulting, you are solving problems that don’t have a clear solution, yet. These are often the most challenging issues the company faces, which is precisely why the consulting team is hired. So how could I actually help him?
But this is exactly what a consulting firm is designed to do. At the highest level, consulting firms are designed to solve customer problems. They build teams and cultures that are obsessed with defining, diagnosing, prioritizing, and taking action on new and novel problems.
And this is exactly what most companies are not designed to do. Most companies have a product or service that they deliver to clients and they are in the business of trying to do that consistently, on time, and on budget.
When these companies face NEW problems, they don’t actually have many people in the company who are trained to address these problems, not to mention the cultural support to work in a different way. While many companies have started to build internal consulting teams (often of former consultants), there is still clear demand for top consulting firms across industry.
Consulting firms fit into the broader idea of “specialization and trade,” something Jane Jacobs pointed out that emerges naturally in ecosystems, like neighborhoods that are allowed to evolve and emerge naturally.
Companies rely on consulting firms and vice versa.
The Real Edge Is PROCESS
The real edge that consulting firms have is an obsession with process. And on two levels:
- Problem-solving process: how you solve problems
- Meta-process: how you talk about how you do #1
The best consulting firms are obsessed with both of these things.
In many companies, the time spent on developing problem-solving skills and fundamentals is surprisingly small. But the time spent thinking and talking about how you approach problems is even smaller (or in many cases, when I survey clients, zero minutes a year).
Then companies come to me and ask, “why is our team struggling to do good work?”
When I worked at McKinsey I was shocked at how much time we spent learning various skills and then talking about them. Once or twice a year, we would attend intensive training weeks, where we would strongly be discouraged from doing client work. The message was clear: learning matters, take this seriously. Outside of training, each week was filled with hours of meta-process discussions:
- How should we structure our team?
- What hours are we going to work?
- How much time should we spend diagnosing the problem?
- What is the right way to think about prioritizing the various goals of the project?
- How much time should we spend interviewing the client to understand the situation?
- Who is responsible for collecting client data?
- Who is responsible for pushing the project forward with senior leaders?
- How are we planning on formatting various documents?
At GE, where I worked previously, no one talked about anything beyond how to format spreadsheets to avoid triggering the managers and higher-ups. But at GE, we were trying to keep the metaphorical trains running on time. While at McKinsey, we were trying to solve something we had never solved before!
Consulting Firms See Problem-Solving As A Linear Process
Given that problem-solving is the core of the work firms like McKinsey, Bain, and BCG do (and I would argue, their true competitive edge), it makes sense that there is a lot of buzz online trying to understand and decode their problem-solving process.
Several prominent firms have spoken on podcasts or published memos outlining their views on and approach to problem-solving. McKinsey’s 7-step approach to problem-solving is by far the most dominant (and many articles or videos you see on “bulletproof” or “expert” problem-solving are derived from their approach).
In 2007 McKinsey published a memo detailing their approach. Here is a screenshot from that memo:
I can tell you from my experience working at McKinsey: that this visual is used all the time internally: in new hire onboarding, in manager training, when creating project timelines, in project kick-offs with clients, or in client workshops. The steps are clear:
- Define the problem
- Structure the problem
- Prioritize the issues
- Plan analyses and work
- Conduct analyses and work
- Synthesize findings
- Recommendations
Though this original representation of 7 steps is somewhat sacrosanct, I’ve always had a strong belief that a linear process doesn’t capture what happens at these firms. In addition to this, McKinsey now works on a much wider range of projects, such as year-long implementation projects, large-scale operations improvement projects, and even data analytics and AI projects. These different types of projects mean there is some variation in the approach.
But at the core of it, the fundamental idea of moving through a process remains the same. Follow the steps and you will end up somewhere good.
Bain also has their framework for problem-solving: the RAPID decision-making framework. It doesn’t cover the entire problem-solving process, just the latter half of it. It’s a proprietary decision-making tool created to “clarify decision accountabilities with multiple stakeholders.” Among other benefits, it is designed to ensure all voices are heard in the process. Here’s an image from an article Bain published in 2023:
Other leading consulting firms have written about their problem-solving approach, though not as explicitly and prolifically as McKinsey. LEK’s “What We Do” page includes a quote from their founder, Iain Evans:
“The most important principles are around the nature of problem-solving. You will very rarely hear anyone at L.E.K. say, ‘The L.E.K. view of this is X.’ You will very often hear people say, ‘We will have to work out from first principles what the answer is for you in your current circumstance.’ We think each problem is unique in itself, and it needs to be worked on.”
This is all helpful context, but I think these frameworks and quotes only provide just that – a framework, or scaffolding, to understand problem-solving. To be effective at it, I think you need to go a layer deeper and understand what makes consultants so skilled at problem-solving.
My Hot Take: Problem-Solving Is Not A Linear Process
I’ve studied these varying approaches to problem-solving. And I’ve seen it in action firsthand at BCG, McKinsey, and with my freelance clients. While I respect McKinsey and the other firms, as well as the white papers they publish, I have found that a linear process comes up short in helping people understand what it feels like during a problem-solving process.
In almost any intensive process-based knowledge work environment, I’ve seen a process like this, moving between two modes of thinking and processing information: top-down and bottom-up.
If you are writing a book, you can think about the top-down mode as the outline you would create and revisit throughout the process. The bottom-up mode would be the writing and would include the surprising insights that emerge as you move through the document.
In consulting:
- Top-down: includes defining the process, structuring the key insights and core ideas, outlining the story, developing a ghost deck, and pulling together the overall messages at the end of a project
- Bottom-up: Includes digging into the data, doing interviews, organizing and synthesizing information, designing individual slides, documents or memos
The problem-solving process happens over time and shifts into these different modes throughout the process. If it’s a longer process these shifts may take days or weeks. If it’s a shorter process, they may only take hours. In a large team, you may have specific members of the team solely focused on the bottom-up mode. For example, someone responsible for an advanced data model.
You may also have someone else, like a project manager or junior partner, responsible for “owning” the overall story. If three different mini-teams are working on three different workstreams, or hypotheses, the project manager would need to make sure the work doesn’t overlap and that the elements of each workstream can fit together.
The problem-solving sessions mentioned earlier tend to focus on the top-down mode. The structuring, the storylining, the overall messages that they want to convey. In those meetings, often the individual consultants prepare to come into the meeting to “pitch” their various parts, pretending their teammates are the client.
Check out this video for a deeper dive.
This process is intense, but over time it gets easier
The back-and-forth process can feel like whiplash and endless. For a three-month project, you might spend the first month a bit confused. Ask yourself, “Where is this going?” Or “Are we missing something?”
But this is where “trusting the process” is so vital. At first, this is hard but with more experience, you start to get a feel for a project like this. Oh, this is messy right now but it always feels like this, I just need to keep moving forward.
Some types of situations that seem to recur include:
- Wanting to abandon the problem statement immediately: You start digging into the data and find something that is counter to what you had thought when you designed the problem. The key here is not to overreact. If you meet with the team and decide that your initial approach is not going to work, you should focus on defining the problem again
- Feeling like the hypotheses are overlapping and not MECE: This is common because at first you are simply asking a lot of questions. Typically, you need to go into the bottom-up mode once or twice after tweaking your hypotheses to validate and verify your questions and direction. After that, you can fine-tune the hypotheses a bit more, hopefully making sure they are MECE. Remember though, MECE is never perfect, it is just a directional aspiration.
- Having “too much”: You are near the end of the project and you have hundreds of pieces of information. It feels overwhelming. This is where structuring and storylining is vital. Working with your team, you need to spend probably 4-5 iterations going through everything and reorganizing it. This may feel time-consuming but getting everything right so that it “flows” is vital.
You can check out this video of how the consulting process maps to the pyramid principle.
Okay, but what makes for effective problem-solving?
In a 2019 episode of the McKinsey Podcast, Hugo Sarrazin, a senior partner at McKinsey, said,
“The most powerful thing is to step back and ask the basic questions: What are we trying to solve? What are the constraints that exist? What are the dependencies?…It’s not like “Can we grow in Japan?” That’s interesting, but [instead] it is “What, specifically, are we trying to uncover in the growth of a product in Japan? Or a segment in Japan? Or a channel in Japan?”
When you spend an enormous amount of time, in the first meeting of the different stakeholders, debating this and having different people put forward what they think the problem definition is, you realize that people have completely different views of why they’re here. That, to me, is the most important step.”
This is a great perspective.
When I first joined McKinsey I thought the labeling of most meetings as “problem-solving sessions” was just a facade.
“Why not call them meetings, or discussions?” I asked.
A colleague shared an interesting hypothesis based on a study she had seen about meeting participant engagement. If meetings were called “problem-solving sessions” or something similar that elicited action, participants would be more engaged and effective.
Internal meetings at McKinsey were far more engaging than those in my prior job (or those I observed with my clients).
Part of that could be the name, sure. But it speaks to the broader mindset that most consultants have: that we are here to solve X problem.
A micro example: if I were leading a problem-solving session, I would send out the agenda beforehand (as is common across companies). Each topic usually included a specific question we needed to answer. If we got off course, it was always helpful to step back and say, “What is the question we are trying to answer today?”
On a more macro level, the questions laddered to the broader problem statement (what we were trying to solve for/with our client).
This mindset, this constant referencing back to the most important question or problem statement, is what sets McKinsey and other leading consulting firms apart.
As you know, the problem-solving approaches of top consulting firms go far beyond simple frameworks or step-by-step guides. The real power lies in the mindset and meta-process that surrounds these methods and in the constant focus on “what are we trying to answer.”
Whether you’re leading a team, starting a business, or simply trying to improve your decision-making, this meta-process can offer you something. Remember, effective problem-solving isn’t about having all the answers – it’s about asking the right questions.
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