by
To my beautiful wife, Gisela,
who brought love
back into my life.
To all the attendees of my seminars,
readers of my books,
and listeners to my audio programs
who shared their problem solving stories with me.
To my three astounding children:
Julia, Dwight, and John.
And to my grandchildren:
Astrid and Thomas.
Section One:
Types of Problems
Chapter 1: There Are Only Two Types of Problems
Chapter 2: Solving People Problems
Chapter 3: Solving Money Problems
Section Two:
Problem Solving Tools
Chapter 4: The Simplest Solution Is the Most Likely
Chapter 5: The Five Whys of Problem Solving
Chapter 6: Don’t Let Anger Exacerbate Your Problem
Chapter 7: Let Your Principles Guide You
Chapter 8: Does the Problem Deserve a Solution?
Chapter 9: Is the Problem Real or Imagined?
Chapter 10: What Happens if You Do Nothing?
Chapter 11: Is the Problem Really Unique?
Section Three:
Questions to Ask Before You Solve a Problem
Chapter 12: Difficulty Defining the Problem
Chapter 13: Don’t Solve Problems Too Quickly
Chapter 14: Don’t Solve Problems Too Slowly
Chapter 15: How Quickly Should You Choose?
Chapter 16: If the Horse Drops Dead, Get Off Fast
Chapter 17: Don’t Bang Your Head Against Concrete Principles
Section Four:
Intuitive Problem Solving
Chapter 18: Do You Have a Golden Gut?
Chapter 19: Is Intuitive Problem Solving Obsolete?
Chapter 20: How Chunking Improves Your Intuition
Chapter 21: Intuition or Rapid Reasoning?
Chapter 22: Improving Intuition With Right-Brained Thinking
Chapter 23: Controlling the Left and Right Sides of the Brain
Chapter 24: Moving Away From the Problem
Chapter 25: Finding New Answers With Creative Thinking
Section Five:
Logical Problem Solving
Chapter 26: Go or No-Go Decisions
Chapter 27: Choosing Between Two Ways to Solve a Problem
Chapter 28: Handicapping Critical Decisions
Section Six:
Gathering Information
Chapter 29: Gathering Information Is the Key to Good Problem Solving
Chapter 30: Information Drift
Section Seven:
Brainstorming
Chapter 31: Should You Brainstorm or Not?
Chapter 32: The Advantages of Brainstorming
Chapter 33: Structured Brainstorming
Section Eight:
What Makes You a Great Problem Solver?
Chapter 34: Traits of Great Problem Solvers
Index
About the Author
If you only have a hammer, you tend to see
every problem as a nail.
—Abraham Maslow
Ten months a year, I travel the country and a good part of the world, conducting seminars for corporations and associations. This means that I’ve had a unique opportunity to sit and talk to some of the most successful people in the company. Whenever my schedule permits, I like to have dinner the night before with the president of the company, or the top performer in the association for which I’ll be speaking. It’s a great opportunity to pick their brains about what made them so successful.
As the topic of problem solving became more and more fascinating to me, I started asking successful businesspeople how they solved problems. How do they go about it in their company? What process do they use?
What I found out was fascinating. Almost nobody has a process for solving problems. I saw people who had built empires, and were respected by everyone in their industry, and people who could commit millions of dollars to a project and not lose a moment’s sleep over it—even they did not seem to know how to solve problems.
A typical response was “A problem comes up, we kick it around, and, if it feels right, we make a move.” Isn’t that interesting? How much better could they be at what they do, if they just got a little bit better at problem solving?
There is a better way, and the starting point is to change the way you think about problem solving. To become a better problem solver you have to stop focusing on the problem itself, and concentrate on the problem-solving process. With a problem-solving process on which you can rely, you will have the confidence that you’re making the right choice, every time.
You may never do the right thing every time, but if you’ll learn the simple techniques in this book, you’ll be making the right choice all the time.
In Section One, we’ll talk about the two major types of problems and how to solve them. Later, I’ll teach you the specific steps to great problem solving.
The first step to solving your problem is to decide whether the problem is about money or people. There really are only two different kinds of problems: money problems and people problems. That doesn’t sound right to you, does it? It’s got to be more complicated than that, you say.
I still remember where I was when I first heard that there are only two kinds of problems. I was living in Bakersfield, California, and somebody suggested that I try attending the Church of Religious Science. When they told me that it wasn’t a Christian church I was skeptical. I was raised Church of England (Anglican in the United States), and my first wife was raised Lutheran. Both believe in a strict agenda in church services and sermons taught straight out of the Bible. A church that taught that there are many paths to God and that powerful thinking could change circumstances seemed more like a motivational rally than a religion.
Sitting in this strange environment with my family I was frankly suspicious and looking for reasons to rule Religious Science out of our lives. When the preacher told that us he was going to talk to us about problem solving, it was definitely not the kind of topic that I’d heard from my vicar back home. Then he made the statement that there are only two types of problems—people problems and money problems—and I was convinced that it was sheer baloney. But that was more than 30 years ago and I’ve never found an exception to that rule.
Don’t confuse people problems with money problems
Believe me when I tell you that you’ll never find a problem or opportunity that can’t be separated this way. Money problems or people problems—there are only two kinds. Or possibly solving the problem will take both money, and people handling skills. People have difficulty solving problems when they confuse the two:
“I own a chain of 60 two hamburger stands in New Jersey. I started it right out of high school with a thousand bucks I borrowed from my uncle. I built this business with sweat and tears. For three years I worked 18 hours a day seven days a week until I could afford to hire some help. My problem is with that first employee. He’s now my executive vice-president. I made this guy. I took him off the street, and now he lives in a mansion and drives a Mercedes. Yesterday, he’s got the gall to tell me that he’s quitting me and going to work for the competition. How could he do this to me, after all I’ve done for him? I asked him if he’d stay for more money. He says sure, but he wants fifty thousand more a year! That’s blackmail!”
This is an example of a person who really has a money problem, not a people problem. If he could only see this clearly, he’d calm down, and know how to negotiate a solution to the problem. He should be calmly thinking, “Okay, so I can solve this problem for $50,000 a year. But, I know I can do better than that. Fifty thousand is unreasonable and he knows it, so he must be upset about something else. We’ll talk, I’ll butter him up, and we’ll work it out. It’s probably not going to cost me anymore than $10K and a new car.”
Here’s a problem that I hear all the time:
“My 25-year-old son is driving me insane. I love him, but I can’t stand him living at the house anymore. He’s driving me crazy with his late-night carousing. I’ve tried laying down ground rules, but nothing seems to work. I ought to throw him out of the house and let him make his own way in the world. It would probably do him a world of good. But I hate to break the ties completely. He’s my only son, and I might never see him again.”
This mother thinks she has a people problem when she really has a money problem. If I asked her how the son would feel if she gave him $800 a month to rent his own apartment, she’d tell me: “Well, that would solve everything, but we don’t have the $800 a month to give him.” That may be so, but when I point this out to her, she’ll see for the first time that it isn’t a people problem she’s facing; it’s a money problem.
I know what you’re thinking. You’re thinking “How shallow can one person be? It’s not right to think that money can solve problems involving other people. I don’t want to go through my life buying people off!” I totally agree with you on that! But if we’re going to be great problem solvers we start by analyzing the situation accurately. Don’t confuse people problems with money problems!
Key points from this chapter:
There are only two kinds of problems: people problems and money problems.
People often confuse the two. They think they have a people problem when they really have only a money problem.
Even if it would take a ridiculous amount of money to solve the problem, you have a money problem, not a people problem.
Now that we know that there are only two types of problems—money problems and people problems—let’s take a look at people problems, which are, without a doubt, the more difficult of the two.
Much of what I’m going to teach you here comes from my years of studying hostage situations, which must be the most difficult of all people problems to solve.
Rule one: Don’t try to sweep people problems under the rug.
If you’ve got someone who is mad at you, you might want to back off for 48 hours to see if the problem goes away. Maybe he just lost his temper and now regrets it. Perhaps what he had to say in the heat of the argument now doesn’t seem so important and certainly not something over which to jeopardize your relationship.
Learn not to shoot from the hip when someone upsets you. I can’t tell you how many times I’ve stopped myself from an angry response that would have exacerbated the problem. Let the old earth take a couple of whirls, as Frank Sinatra advises in the classic “September Song.” Former President Clinton learned that well. As a governor he would get himself into trouble with flip responses like “I never inhaled.” As President, and now international ambassador, you can almost hear him counting to 10 with his right thumb extended, before he responds.
But if the other person is still angry with you after 48 hours you need to talk about the problem, not ignore it.
If you’ve got a boss who is giving you the cold shoulder you need to ask for face-to-face time to discuss the problem. Perhaps he misunderstood your point of view. Maybe another employee has unfairly poisoned your relationship with your boss using unfair accusations.
Perhaps your problem is a parent or child who is being sullen with you over some imagined slight. Don’t let it go past 48 hours without addressing the problem.
Rule two: Verify that there really is a problem.
Be careful that you’re not overreacting to a situation. The last thing you need is to get a reputation for being so sensitive that people have to watch out for every word they say when they’re around you.
If the problem is with your boss you might say to his or her assistant, “Is the boss upset with me? He didn’t even speak to me when he came through my department this morning.” The response may well be, “Oh no, everything’s fine. He’s just preoccupied with a hassle he’s having with head office.”
If the problem is with a child, you might say to her brother or sister “What’s bothering your brother these days?”
If you’re worried about your parent’s reaction to a situation, try, “Mom, what’s Dad so upset about these days? He hasn’t yelled at me all week!”
Rule three: Keep communications open at all cost.
This is something that I learned from studying hostage negotiations. You have to establish and maintain communications at all cost. Unless you are able to talk to the person the situation is going to get worse.
In a hostage situation the first thing that the negotiators will want to do is establish communications. Figure out a way to get talking with the perpetrators. Don’t worry at this stage about how outrageous their demands might be. Get them talking and keep the lines of communication open.
On the opening day of school in Beslan, Russia, a small town between the Caspian and Black Seas, terrorists stormed the facility and took 1,100 parents and children hostage. The authorities correctly isolated the school and attempted to communicate with the perpetrators. “What do you want?” they asked them. “Are you demanding the release of prisoners in Chechen? Do you want money? What is it you want?”
Their reply was, “We don’t want anything! We came here to die!” Let me tell you something. That is not a good start to resolving people problems! Unless you can get the other person talking to you, you have little chance of resolving the problem to both sides’ satisfaction.
The other thing that went wrong with the Russian school hostage taking was that President Putin took a very strong line. He wanted the negotiations to go no more than three days before he would attack the compound.
There is a thing called acceptance time in a negotiation. It takes time for people to realize that they are not going to accomplish what they want out of the situation. The school hijacking was a situation that demanded a lot of acceptance time. Waiting it out may have taken a few months but it was preferable to what happened when the authorities attacked, costing the lives of 334 people and injuring hundreds.
Rule four: In an impasse create momentum with small concessions.
When neither side sees any possibility of resolving the problem, we call that an impasse in conflict resolution. It’s important not to confuse an impasse with a deadlock, which is far more serious.
An impasse is when both sides are so far apart on the major issue that they see no possibility of a peaceful resolution. The way to handle an impasse is to create momentum by reaching agreement on little issues first. It may be that you both agree to keep the issue confidential while you’re trying to resolve the problem.
As you create momentum by reaching agreement on little issues, it’s important not to narrow the remaining issues too far. If you resolve all the minor issues and are left with only one major issue, there has to be a winner and there has to be a loser.
This is what went wrong when the Iraqis tried to write a constitution for their country. Their first constitution that established a monarchy was created in 1925 under the British occupation. When Iraq became a republic in 1958 they attempted to revise their constitution many times but could not reach agreement. With Saddam’s Hussein’s dictatorship it all became moot. In 2006, after the U.S. invasion, the new parliament created an Iraqi Constitution Drafting Committee and gave them six months to write a new constitution.
At the end of that time they requested a one-week extension because they still had three issues left to resolve. That sounded encouraging until we asked them to describe the three issues. They were: 1.) Should it be a regional or federal government? 2.) Should it be a secular or religious government? and 3.) Who would get the oil money? Those are three big issues to resolve in a week, but they hobbled together a solution, and submitted it to parliament who reluctantly approved it and then it went to a public vote.
It passed with a small majority (remember the purple thumbs?) and became the law of the land, although nobody seemed happy with the solution and there has been constant wrangling over it ever since.
If you’re in mediation and you narrow down the issues that way, there has to be a winner and there has to be a loser. Keep enough issues open so you can trade off one against another, and you can create a win-win solution where everyone feels that they’ve won.
Rule five: If you reach a deadlock, bring in a third party.
Here’s my definition of a deadlock: Neither side sees any point in talking to each other.
If your personal problem has advanced to that stage, there is only one way to resolve it, and that is to bring in a third party as a mediator or an arbitrator.
There’s a big difference between the two. A mediator doesn’t have a lot of power. He or she is there to facilitate a solution. An arbitrator has a lot of power. With binding arbitration there will be a winner and there will be a loser. At the end of binding arbitration the arbitrator will decide who is at fault and what the penalty should be.
The key issue with both mediators and arbitrators is that they must be perceived as neutral by both sides. They cannot be effective unless they are perceived as neutral by both sides.
If you are dealing with a people problem it is unlikely that you’ll choose arbitration. That’s more applicable for money problems. You’ll want to go with mediation.
You could hire a professional mediator, but a trusted psychotherapist would work also. Be sure that the person has mediation experience and knows how to mediate. Not all of them do.
There are many advantages to mediation. Here are the key ones:
If you’re not talking to the other person a mediator can get the parties to agree to another meeting. That’s hard for the participants to do unless the other side is willing to change their position.
They can be far more persuasive in dealing with the other person if they are perceived as neutral. You lose 80 percent of your ability to persuade people if they think you have something to gain from the attempt.
Mediators can float trial balloons in an attempt to find acceptable solutions. The mediator can go to each side separately and suggest, “What if I could get them to agree to do this…?” If you were to approach the other side directly they may see it as a weakening of your position and a chance to increase their demands.
Rule six: Don’t expect too much from the resolution to a problem.
If your people problem is that you haven’t spoken to the other person for years be careful that you’re not fantasizing about how great life will be once you’re talking to each other again.
I once knew a woman who hadn’t spoken to her son for 15 years and was torn apart by grief over the situation. She had no idea where her son was or what he had been doing since they last saw each other when he was 5 years old.
I went to extraordinary lengths to locate the son and get them together again, assuming that it would be the most wonderful thing that I could do for them. They stayed together for a year or two but then drifted apart again. The problems that had caused the rift were still there.
Your person problem may be tearing you apart but solving it is not going to solve all the problems in your life. Be realistic about what you can accomplish.
Having said that, if you’ve got someone in your life at whom you’re hopping mad at, contacting him or her will be a very therapeutic thing for you to do.
I remember trying to persuade a young lady to do this. She had a father in Oregon whom she hadn’t seen for many, many years. She held inside her an incredible amount of bitterness toward him, with very good reason. When she told me the things he’d done, I thought of the line in the song “How Can People Be So Heartless?” He was clearly a total jerk. I encouraged her to go to Oregon to meet him—not to forgive him or make friends with him but merely to make contact and complete the gap in this relationship, a gap that was affecting her enjoyment of the present moment so much.
She did, and when she returned she was positively glowing. Guess what she told me? Her father was still a jerk. However, now she could say it with a smile on her face. With this encounter, she had flushed away all the vitriolic feelings that had poisoned her system for years. She still didn’t like him or choose to spend any time with him, and, to the best of my knowledge, she never saw him again. However, the meeting cleaned up her life.
If you have someone from whom you’re estranged, you may be thinking just the opposite. Your thinking might be, “If I make contact with this person again, I’ll feel responsible for them. They’ll expect me to give them money and spend every weekend with them and I don’t want to go there again.” That’s fine. You can create boundaries once you’re talking to the person again. Even if you decide that you’ll only have lunch together twice a year, you’ll feel a lot better about yourself because you made contact.
Rule seven: Be sure that you’re defining the problem properly.
Once a man e-mailed me from Italy, because he wanted to move to California. He felt he had a terrific business opportunity available to him and could be very successful. However, it would mean leaving behind his wife and his two young daughters, for at least five years.
A good problem-solver would know immediately he was making two very glaring errors. His first error? He wasn’t defining the problem properly, which means laying out a clear picture of the entire problem or opportunity.
His second error? A very common one: He was jumping to the conclusion that he faced a dichotomy, meaning he thought he only had the choice of moving to California, or not moving to California. A good problem solver would know that he had not categorized the problem properly.
I told him he’d be crazy to be away from his family for five years. He’d miss the chance of seeing his two young daughters grow up and mature into young women. His problem was, he’d reduced the situation to a dichotomy: either move to California and leave his family behind, or not move to California. What he should have been doing was using creative thinking to find a way he could move to California and still bring his family with him.
Rule eight: Analyze the consequence of potential solutions.
In another instance, a woman called me from San Francisco to tell me her husband had transferred to San Diego. He’d be there for at least a year and possibly longer than that. Then they’d promote him again and probably transfer him back to the head office in San Francisco Bay area. She couldn’t decide whether to go through the trauma of selling their home, and moving to San Diego. Should she stay and wait for him to come back?
To a good problem-solver, this is a clear case of not thoroughly thinking through the consequences of what she was considering. A simple analysis would have given her a choice of consequences for each option that she was considering.
I advised her to get herself down to San Diego on the next plane, if she cared anything at all about her marriage. She wasn’t thinking through the consequences of her actions. San Diego isn’t Sioux City, Iowa. If she let her husband play bachelor in San Diego for a whole year, the chance of it destroying their marriage was high.
A simple reaction table would have told her that she had a great deal to lose and little to gain.
Rule nine: Don’t confuse the issues.
In a third instance, a young man asked me a question at a seminar I conducted in Guangzhou, China. He wanted me to tell him if he should marry the woman he had been dating. He loved her, and she wanted to get married, but he wasn’t so sure. Because of the Chinese “one child only” policy, men outnumber women in China. The Chinese Academy of Social Sciences in Beijing reports that there are now 120 males for every 100 females in China. You can imagine how hard that makes it for a man to find a bride.
In problem-solving terms, this is a clear case of not properly defining the problem, causing him to confuse two completely different issues.
Good problem solvers don’t agonize over issues like this. They have a mental procedure they can follow very quickly, which to other people might seem instantaneous. In reality they’re quickly going through a series of steps.
I’d never met the young lady, but I told him, yes, he should marry, but not marry that woman. His problem was he was tying together two separate decisions, and making them as if they were one decision. Yes, he should marry. I still think that it’s the most wonderful thing any person can do (in spite of the fact that a survey by Pew Research and reported in a cover story in Time magazine showed that 40 percent of Americans think that marriage is obsolete). But if my young friend in China has to ask a complete stranger whether he should marry this woman or not, then the answer has to be no. When he finds the right person for him, he’ll know it’s the right decision and he won’t be asking anyone, much less a complete stranger like me. I told him that when he finds the right woman wild horses won’t stop him from marrying her—a bold response but one that caused a huge round of applause from my audience in Guangzhou.
Key points from this chapter Don’t try to sweep people problems under the rug. If the problem hasn’t resolved itself in 48 hours you need to take action.
Be careful that you’re not overreacting to a situation. The last thing you need is to get a reputation of being so sensitive that people have to watch out for every word they say when they’re around you.
Establish and maintain communications at all cost. Unless you are able to talk to the person the situation is going to get worse.
If you reach an impasse create momentum by reaching agreement on small issues.
Don’t narrow it down too far. Keep enough issues on the table to be able to trade off one for another so that both sides feel that they won.
If you reach a deadlock bring in a third person as a mediator.
The mediator cannot be effective unless perceived as neutral by both sides.
Don’t expect too much from resolution of the issue.
Be sure that you’re defining the problem well.
Are you sure that you are considering all the possible solutions? Dichotomies are rare. Seldom do you have a problem where you only have two solutions from which to choose.
Be sure to think through all the consequences of each solution.
Be sure that you’re defining the problem accurately. “Should I marry?” is not the same problem as “Should I marry this person?” “Should I go into business for myself?” is not the same as “Should I go into this business?”
Now let’s talk about money problems. Sufficient cash flow is essential to your success and well-being. Every businessperson learns, usually the hard way, that there is a big difference between assets and cash flow. You can have massive assets—large companies might have hundreds of millions in assets—and still go out of business because you lack cash flow. It’s something about which businesses and families must be constantly diligent.
Don’t feel ashamed that you lack the cash to pay your expenses. It can happen to the best of us. If General Motors can have a cash flow problem (and it has many times) you can, too.
Here’s how to handle a shortage of cash in your business. The same rules apply to your personal finances.
You must make payroll
Your biggest business priority when you run out of cash is payroll. In business if you miss one payday, you are out of business. If you are not able to make a Friday payroll for your people, you will have to close the doors on Monday. If you can’t make payroll on the 15th of the month, you must shut the doors on the 16th. Don’t be fooled by thinking, “My people love me. They’ll understand.” No, they won’t. Try missing one payday and see how much they love you.
Making payroll becomes your key priority. You need to do a cash flow projection for the next three months, using projected income figures that are realistic, not hopeful, and be sure that you will be able to meet payroll.
If it doesn’t look as though you will have enough income to make payroll you’re going to have to reduce your payroll costs. Nobody enjoys doing this, but it is essential to your survival.
As you think about the people who work for you, you will probably think of one or two people whom you wish would quit. Perhaps they’ve been with you a long time and you have a strong sense of loyalty to them. Perhaps they have been made redundant by technology. Are you still employing a full-time bookkeeper now that computers have made the job possible to do in one quarter of the time? Do you still have someone answering the phones when most of the calls go through to an answering system anyway? Do you still have a vice president of mimeographing locked away in the basement? If you’ve got anybody on payroll that you wish would make your life easier by quitting, you need to take action right away. Get them out of there!
If you’re conflict averse it will probably occur to you that instead of firing people you should cut back everybody’s hours. That may be a temporary solution if you are between orders and will need all of them in a month or two, but there’s a real danger that you make everyone unhappy when you do that. It’s better to let some people go and let them collect unemployment compensation for a while. Hopefully you’ll be able to rehire them when business picks up. If you cut everyone’s hours, you’re just passing on your cash flow problem to your employees.
Here’s a tip for you: Consider how conflict-averse you are. Some people love a good fight. Their idea of a fun evening is to go to bar and pick a fight with someone. If they are in the military, they want to be on the front lines where the action is. That’s not me, and perhaps it’s not you either. If you’re conflict-averse, there’s a high probability that you have failed to take the tough action that a businessperson in a cash flow crunch needs to have done.
Having terminated the people that you wish would have quit, consider the poor producers. Do you have salespeople that are having a tough time making their sales quota? Perhaps it’s time to let them go and reassign your sales territories.
The key issue with reducing payroll costs is that you must be proactive. If you don’t take control you’ll find that the people who leave will be your best people because they have an easier time finding another job.
How to fire someone painlessly
I’ve fired dozens of people in my business career and I’ve never enjoyed doing it, but I did develop a way of doing it with as little pain as possible. Call them into your office and talk about the problems you’re having until they realize that they’re about to get fired. Then their interest is accepting your decision with the least amount of unpleasantness.
If the issue is their poor performance you might say, “Joe, when you joined us six months ago we had very high hopes for your performance. We set some challenging sales goals for you but felt confident that you would make them. As you’re well aware, that hasn’t happened. As of the end of last month you’re still 28 percent off of your quota and that’s just unacceptable.” At this point Joe is getting the idea that he’s going to get fired and wants to get out of there gracefully just as much as you do.
If the issue is a bad economy you might say, “I’m sure you’re aware that we’ve been going through some very tough times lately. Business is down 38 percent from last year and we’ve come to the point when we have to adjust our payroll. We hate to let anyone go, of course, but it’s come to the point where we have to take action or risk being out of business altogether.”
Be sure that you have firmness and certainty in your voice. You are telling about a decision that you’ve made, not starting a conversation or, worse yet, an argument.
Get back to your core business
If you run a formerly successful business that is now suffering a cash flow problem, I’m pretty sure that I can identify your problem: You have diversified away from your core business.
A good friend of mine used to be a business consultant for a nationwide consulting firm. His job was to go into a company and investigate their business problems. He told me, “Roger, almost invariably I knew what their problem was the first day I got there. But I couldn’t tell them then because I had to justify the huge bill that we were going to send them. I would work diligently for a couple of weeks and then tell them.