Example: Ineffective Action due to treating symptoms instead of problems.

Third quarter reports indicate that sales for home PCs are down 4%. The supervisor decides to hire more sales people and to increase the advertising budget. Sales are down 7% the fourth quarter. Perplexed, the supervisor decides to engage in research. She instructs the sales force to talk to product users and discovers that consumers want a total-satisfaction guarantee that's truly comprehensive. This time, the supervisor talks to customer service, gets them to offer a "we'll make it work, no matter what" contract to get a PC up and running. Sales improved the following quarter.

This example illustrates that misdiagnosing a symptom, as a problem can be costly. The problem was not the decrease in sales (symptom), but the service offered to first-time PC users. The supervisor allocated resources to her decisions (hiring more sales people and increasing advertising) that did not fix the problem. Thus, problem definition means recognizing the real factors and not confusing the symptoms with the problem.