5 whys analysis
To find the solution to a problem, it is necessary to underline the root cause of the issue. 5 whys analysis brings out the true factor that causes the defect. A large West Coast Marina wanted a root cause analysis for the excessive time consumption for processing and collecting the moorage fee. The conventional process included four major steps that took up more than 12 processing hours.
When the Marina decided to invest in an automated system it also involved a third-party company to document the current scenario and should-be processes, write a business case that could justify the investment of $100,000, and to come up with a business requirements document that would help with the implementation.
One of the major arenas that required reconsideration was the sending of invoices to the boaters for moorage usage collection discrepancies. 5 whys analysis was used to come up with the cause and effect of this particular process. It concluded to an assumption that the boaters could get away without paying for the facility, and therefore it was necessary to charge them with the invoices.
This root cause analysis and subsequent validation of the data resulted in the fact that it was not worthwhile to spend $300 a day to catch up to an underpayment of $2.60 a day when most of the moorage users paid voluntarily or overpaid for using the marina.
Therefore, the initial budget decided to implement a technological solution was eliminated, the unnecessary steps of making extra rounds to collect the details of the boat, and sending invoices to users were reduced. The simple 5 whys analysis brought about an extra 10 valuable work hours, and saved the marina not just the $100,000 capital investment amount but also saved them a massive $200,000 on the first year and $100,000 the following years.
To sustain what the root cause analysis had indicated, the consulting firm suggested a monthly audit. This would not only ensure that the moorage users were paying their bills right, but also could call for a reassessment if required.