Causal Analysis: 4 Ways To Solve Lurking Business Problems Easily

PESTLEanalysis Team
PESTLEanalysis Team
Causal Analysis: 4 Ways To Solve Lurking Business Problems Easily
Table of Contents
Table of Contents

Here are four methods to help you carry out a causal analysis, a highly effective technique to identify the factors causing a particular problem.

Many things are going around us that we find odd or believe shouldn't happen. As humans, we try to look deeper into these problems to know where they originated.

This may seem odd, but it is in human nature to get curious about problems and look for their root cause so that they know why a certain problem is arising. This habit of tracing the root cause of any problem has proven to be beneficial many times.

If you look into it, all the research that has taken place in the history of mankind started from curious individuals who wanted to know the root cause of any problem. For example, a long time ago, people believed that evil spirits caused infectious diseases.

However, as people started looking for the causes of why people fall sick, they concluded that certain viruses and bacterias are responsible for causing illness, not evil spirits. 

This example proves that if you want to solve any problem, don't look at the problem. Instead, look deep into what factors are causing that problem. Many techniques are used to look for the root cause of any problem. However, the Causal Analysis is a highly effective technique to identify the factors causing a particular problem. 

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The Causal analysis is a very useful tool used by businesses, analysts, and individuals since it can help you identify the factors that are causing certain problems in your businesses as well as in your personal life.

Businesses use Causal analysis to identify the causes behind different business problems. For example, if a business is facing liquidity problems, conducting a Causal analysis will help the business identify the root causes that would be causing the problem of liquidity.

This article will deeply analyze Causal analysis and how to write a Causal analysis essay. Besides that, we will also discuss why we need Causal analysis and have a look at its methods. Other than that, this article will also provide a comparison between Causal analysis and Process analysis.

After getting an overview of what this article will offer, without wasting a minute, let's proceed further and discuss what Causal analysis is.

What Is Causal Analysis?

Causal analysis is a tool used by different businesses and people to identify the causes of a problem. It highlights the factors that together cause a problem. The need to know the causes of a problem arises when you want to solve a problem.

To solve any problem, it is essential to know what factors are causing the problem. For example, imagine you are a CEO of a well-established company, and suddenly you are told that your company is suffering from severe losses. What will you do?

In this case, you know the problem, but that's not it. However, to fix a problem, it is essential to know the factors causing it. In your case, the losses incurred by your company are a symptom telling you that something wrong is going on. 

In this case, you should immediately conduct a Causal analysis and see the factors leading your company to losses. The causal analysis will help you identify the factors causing losses to your company. For example, it might identify absenteeism or inefficiency, causing losses in your company.

However, once it identifies the factors, you can work on them to solve the problem of losses. This is how Causal analysis can practically help in solving many problems.

After reading this example, you would have realized what Causal analysis is and how it applies to identifying the causes of problems.

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How To Write A Causal Analysis Essay (Step By Step)

So far, we have discussed what Causal analysis is. Now, we will shed light on what a Causal analysis essay is and how to write one. The Causal analysis essay shows the causes of any problem or problems that came into being due to certain factors.

A Causal analysis essay tries to answer the question "Why" related to any problem. For example, if the essay is about Kodak, it will base the entire argument around "Why did Kodak go bankrupt?"

The Causal analysis essay tries to simplify complex events by deeply analyzing and explaining why such events occur.

This section will provide step-by-step guidance about writing a Causal analysis essay. So, let's proceed further and look at the first step of writing a Causal analysis essay.

1. Select A Topic

The first step to writing the Causal Analysis is to select the topic. This step is the stepping stone that will lay the foundation of the entire Causal analysis essay. Hence this step must be carefully reviewed, and the topic must be carefully chosen.

Now the question here arises, how to choose the right topic? Well, the answer to this question is quite simple. Choose the topic of interest, anything you feel you can write about. While choosing the topic, it is essential to follow your heart because you can't forcefully write on a topic that you find boring.

Suppose you are a business student or have an interest in the operations of MNCs. Here are some of the topics that you can choose while writing a Causal analysis essay:

  • What is the impact of IT industry growth on immigration?
  • How is technology changing the workplace environment?
  • How is technology making our lives difficult?
  • What is causing an increase in the number of mass shooting cases in the US?
  • Cause-and-effect of the MeToo movement
  • Are there still hints of gender bias in society?

2. Write the Thesis Statement

The second step you should follow while writing a Causal analysis essay is the thesis statement. The Causal analysis essay thesis statement is the same as the thesis statement of any other essay.

In the thesis statement, all you have to do is to state the purpose of writing the Causal analysis essay. Then, briefly explain in two to three sentences what the essay's outcome will be and what areas this essay will focus on. For example, the topic we chose in the previous section was "why did Kodak go bankrupt?"

The thesis statement for this topic could be this: Many businesses go bankrupt worldwide. However, in every case, different factors lead to bankruptcy. Did mismanagement lead Kodak to bankruptcy?

3. Write The Introduction

After writing the thesis statement, just jump to the introduction. The thesis statement in the previous section can be included at the end of the introduction to give the readers a little insight into the essay.

Moreover, the start of the introduction should be very catchy. It should have the ability to grab the reader's attention. An interesting quote, statistic, or something hilarious can be a hook statement. It is advised to start your essay with a hook statement.

For example, in the case of our topic, the hook statement used in the introduction can be "Did you know NASA’s Spacecrafts that were sent to photograph the moon for the first time had Kodak’s photographic system?"

4. Continue With The Main Body

After you're done with writing the introduction, proceed further and continue with the main body of the essay. Make sure to write the essay in paragraphs and include one cause or effect in each paragraph.

Create a chain of causes or effects with the help of paragraphs. This will make the readers understand everything easily. Always remember to clarify the relationship between causes and effects throughout the essay; this will make your argument stronger.

5. Write The Conclusion

At the end of the Causal analysis, add a conclusion section that will summarise all the points discussed in the essay. By doing so, the memory of readers will be refreshed, and they will remember the points you made throughout the essay.

Moreover, remember to finish your essay with thought-provoking sentences. For example, in the case of our essay, we finish it with, "All the factors mentioned in the essay led to the bankruptcy of Kodak. Now the company has to take care of these factors so that it operates smoothly in the future."

Why Do We Need Causal Analysis?

Previously, we discussed what Causal analysis is and how to write a Causal analysis essay. However, we haven't really addressed the question of why we need Causal analysis.

We need Causal analysis so that we can identify the factors that cause a certain problem or the reasons due to which a specific event takes place.

We often see things that make us wonder what the reason behind them is. Moreover, knowing the cause behind a problem is very important if you want to solve that problem. Therefore, Causal Analysis is very important in personal and professional life since it simultaneously identifies the causes and effects.

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Methods of Causal Analysis

Many methods help in highlighting the causes or different parts of the problem. In this section, we have discussed some different methods that can help us carry out a Causal analysis.

Five Whys Analysis

The five whys is a method to carry out the causal analysis. It is named five whys because this method looks for the "why" of the problem. It focuses on why a problem is arising. This method builds a chain of questions that gets the reader closer to why a problem occurs.

To carry out the five whys analysis, initially, you have to ask the core question. To solve this question, all the other questions are derived. For example, if your business is generating low revenue, your question can be:

My business is generating low revenue. Why?

Then comes the second question. This question tries to answer the first question and identify the cause of the problem identified in the first question. For example:

The business couldn’t sell many products. Why?

The third why question follows the trend and tries to answer the second question: 

The marketing strategy wasn’t good enough. Why?

The fourth question answers the third question. For example, in this case, it will answer why the marketing strategy is not good enough:

The marketing team is not skilled enough. Why?

The last question answers the fourth question and provides the root cause of the problem:

The marketing team consists of young and inexperienced members. Why?

The root cause of not being able to generate higher revenue is the young and inexperienced marketing team. In this way, the five whys show that to generate higher revenue, you need to have an experienced marketing team.

Fault Tree Analysis

This is an analysis that helps in visualizing the relationship between the causes and effects. To carry out the fault tree analysis. Draw a box at the top in which you write down the challenge you are facing. For example, you score bad grades in university. Write this in the top box.

Draw other boxes below highlighting the causes that led to the challenge. For example, you didn't study enough. Write this in a box below the top box and connect them with an arrow.

Continue making and connecting boxes with each other until you reach the root cause of the main problem.

Current Reality Tree

The current reality tree also identifies the causes of the problems by writing the problems at the end of the tree and then joining them with the causes, similar to fault tree analysis. As you'll keep on writing the causes for different problems, soon you'll realize a correlation between the causes of different problems.

Connect the similar causes of each problem, and in the end, you will realize that all the problems have one or two root causes.

Rapid Problem Resolution Analysis

This analysis focuses on quickly identifying and resolving the causes that create problems. In this analysis, you gather data about each challenge and its hypothesized cause. Then you plan a response to each cause and apply them. The applied solutions are then reviewed, and their effectiveness is determined.

What Is The Difference Between Causal Analysis And Process Analysis?

We have been discussing the purpose of Causal analysis throughout this article. We stated that Causal analysis is used by businesses and individuals to identify the causes of any existing problem. It highlights the relationship between causes and effects.

However, another analysis is used quite often by businesses. It is called process analysis. Process analysis is used to analyze the operations of a business in detail. It closely looks at the entire process to see what improvements are needed in the operations to increase the efficiency or effectiveness of the business.

Causal analysis and process analysis are two different techniques used for different purposes. The primary purpose of a process analysis is to identify the problems in the business operations. Process analysis focuses on the problems, whereas the main objective of Causal analysis is to identify the root cause of a problem. This means that Causal analysis is more interested in finding the causes that are creating a problem.

Moreover, Process analysis is business-centric in nature. It looks forward to increasing the efficiency and revenue of a business by identifying the flaws in the business operations. However, Causal analysis can be applied to both business problems and personal problems.

Other than that, process analysis is used to solve problems related to business management only. However, Causal analysis is used to solve any type of problem.

Causal Analysis: Final Word

Causal analysis is a tool used by a number of businesses for problem-solving. It identifies the causes that lead to a certain business problem. In this article, we shed light on what Causal analysis is. After clarifying, we proceeded further and discussed how to write a Causal analysis essay.

After that, we discussed why we need Causal analysis and we discussed different methods to carry out Causal analysis, which included Five Whys analysis, Fault Tree Analysis, Current Reality analysis, and Rapid Problem Resolution analysis.

Then, in the end, we discussed process analysis and the differences between Causal analysis and Process analysis. We hope this article will provide you with all the required insight into Causal analysis.



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