5 critical steps to apply analytical thinking with examples
Analytical thinking skills are on a rise. They made their way into job descriptions, interview questions and university curricula. Everybody wants us to think analytically, but nobody is very clear on what it means. If, like me, you were the kind of a child that opens toys up to see what they’re made of, you may have an idea about analytical thinking already without even knowing. This, or you were just a very messy kid.
As adults, we all badly need analytical thinking skills. So let’s start with a good definition. Analytical thinking means clearly stating the issue and breaking it down into smaller components, until these components can be understood or solved. As adults, we also want to be able to put the toy back together, that is to build an overall understanding or a solution.
Analytical thinking proceeds in 5 critical steps. You need to take all of them and in this precise order to see this thinking style in action.
Step 1: Clearly define the problem, issue or topic within the analytical thinking framework
The first rule of using analytical thinking is to define the problem, issue or topic you’re facing as clearly and concretely as you can. Then you need to frame this problem statement as an analytical thinking issue – if you can’t do it, you need to apply a different thinking style.
One of the biggest challenges we’re facing as thinkers is stating our issues clearly and concretely. Instead of sharply formulated problem statements, we’re trying to think about questions or ideas that are ill-defined, and very often just flowing freely and changing shape. Don’t think “how can I make my business successful?”, but instead think “how can I increase profitability to break even next year?”. Once you have a problem statement like this one, you can check if it can be solved with analytical thinking. And this is how you do it! The main problem is “profitability” – does profitability have natural sub-components? Indeed, profitability can be defined as “revenues” minus “costs”, so there’s already a way to break this problem down. Even if there are no natural sub-components, try to think of potential sub-components of your problem, if you can. This is a clear signal you can approach the problem of your profitability with analytical thinking.
Step 2: Break the problem statement down into smaller problems
Once you confirm you can use analytical thinking, start breaking your problem statement down into smaller problems in writing. Use one of the analytical thinking tools: 5 whys, fishbone diagram, issue tree, cost benefit analysis, benchmarking, or relations diagram.
Take a piece of paper, write your problem statement down and draw smaller problems that the main issue is made up of. Returning to “profitability” above, you can easily break it down into “revenues” and “costs”. Then the problem you’re facing is not increasing the overwhelming profitability but using the next year to increase your revenues and cut down your costs. These two smaller problems are already much more concrete and with graspable solutions.
Step 3: Continue breaking smaller problems into even smaller problems
Don’t stop just at the first layer of depth. The strength of analytical thinking lies in going deep into the problem into its smallest parts. Continue the process until you reach small problems that are solvable and actionable, , following the tool you adopted.
Continue drawing your diagram and breaking each smaller problem into even smaller two or three problems in turn. “Revenues” could be further broken down into revenue sources, product lines, or for example passive and active revenue. If you’re selling three main services, then the problem becomes how to increase your revenue from every service separately. Then you take the first service, and the problem statement becomes “how to increase revenue from this service”. Continue drilling down until you get to the point where you can start thinking of solutions that can be implemented within a few days. By the end of this process, your diagram should look like a root, or an upside-down tree. Don’t be tempted to stop once you got a clearer or better idea of the problem. Complete the whole problem tree, because stopping too soon can make you miss some important steps.
Step 4: Solve the smallest problems first
It’s tempting to try to solve the main problem statement right away, but you have to start by solving the smallest problems you identified first. Work your way bottom up.
Once you’ve gained some clarity thanks to analytical thinking, you’ll be tempted to jump back at solving the main problem statement. Instead, start solving the smallest problems first. If you got to the right level of depth, you’ll be able to implement solutions within a few days. Work through the problems at the same level of depth sequentially but look for patterns and be mindful of all solutions you can reuse within your problem tree. Keep track of your solutions and results.
Step 5: Integrate solutions into the main answer
As you work your way through solving smaller problems, these solutions will get you closer to solving the main problem statement. The timeline of your work should be dictated by the main problem statement, and you should always check that your solutions are aligned.
When you begin to start solving smaller problems, make sure that you plan and schedule your work to fit the main problem statement timeline. For example, we wanted to fix profitability within a year – so naturally we have to work our way from left to right and from bottom to top in our problem tree within this timeframe. When you work through the problem statement this way, make sure you check that a solution to one problem doesn’t cause an issue somewhere else, or that it doesn’t derail your work and attempts in another region of the tree.
Where do you think you can apply analytical thinking? Identify one problem you’re tackling right now and approach it using these 5 steps. How did it go?If you’d like to learn more, subscribe to Lessons in Thinkfulness and receive free, weekly lessons designed to help you become more thinkful at work, in business and in life.