Understanding root cause analysis
As a quality assurance supervisor at RSM South Africa I have participated in our internal firm inspections as well as our regulatory inspection. One thing they both have in common (among other things) is the need to perform a root cause analysis for deficiencies identified and reported. Why is this such a necessity?
Think about it this way. When you are not feeling well and decide to go to the doctor – do you want the doctor to tell you what’s really wrong with you so they can start to treat the actual illness? Or are you content with them only treating your current symptoms possibly leaving the actual illness undiagnosed? I think not.
Performing a surface level analysis that only ticks a box will have the same effect. We might be able to alleviate the impact of certain findings in the short term, but we will not be able to solve the issue that gave rise to the finding in the first place. This will lead to repeat findings year after year with little value added to our system of quality management.
Getting to the root cause of an issue that may represent a “deficiency” is never easy. While performing some research I came across an analogy that I think explains the root cause analysis brilliantly:
Anyone that knows a little about gardening will know that if you do not pull a weed out from its root, it will grow back again. The root is the real basis for the weed’s existence, not the stalk, the leafy outgrowths, or the flowering head.
Understanding and being able to perform a proper root cause analysis can be an advantage in any business, not just for an audit firm. If profits are declining month on month despite implementing price increases, costs reductions, etc, it might be worthwhile to perform a root cause analysis to get to the root of the declining profits.
There are a few formalised methodologies to perform root cause analysis, including fishbone diagrams, fault tree analysis, and other methods, but I think keeping it simple is best. I have been involved in a few instances where we have had to identify a root cause for a specific finding and an easy way to be able to get to the root cause is often simply to ask why 5 times.
Let's take declining profits as an example. Why are profits declining (first why)? Because the amount of units sold decreased. Second why? Because we had less bulk orders compared to previous periods. Why?... this process continues till you have asked why 5 times. This will ensure that the identification process goes into sufficient detail to get to the root cause of the issue at hand.
Once the root cause has been identified, remedial action (a solution) can be implemented to address and hopefully eliminate that specific issue/problem for the foreseeable future.
This why root cause analysis is so vital!
Quality Assurance Supervisor, Johannesburg