How to write a problem statement

Notebook notes - Tips on how to write a problem statement

Without a clear and concise problem statement that your team and stakeholder can align on, you’re going to stuggle.

Reader warning - This is part of my 'short notes of things that I want to remember' so not a lot of thought has gone into the readability of this.

I break problem statements into four sections:

  1. Situation

  2. Complication

  3. Question

  4. Next steps or answer

Situation

  • What is happening?

  • What is the current state?

  • What is a set of facts you can agree on?

Complication

  • What is the reason why you are working on the problem to begin with? Or what changed?

  • What is the tension?

  • What has changed that forces the need for a new answer?

  • Are there any external or internal pressures?

Question

  • What is/are the hypotheses on how to solve the problem?

Next steps or answer

  • What are the recommendations on what you should do next?

  • What findings do you have from research that specifically confirm or disprove the hypotheses

The fourth section ‘Next steps or answer’ can vary depending if you’re using the problem statement at the start or the end of a discovery etc.

Lets look at an example:

Situation:

We are experiencing a decline in customer retention and lower customer lifetime value.

Complication:

Our competition has intensified, with numerous online platforms offering similar products and services. Additionally, customer expectations and demands have evolved, requiring us to adapt and improve our strategies to retain customers and maximize their lifetime value.

Question:

What strategies can we apply and test to improve customer retention and increase customer lifetime value in our e-commerce business?

Next steps:

  • Conduct a comprehensive analysis of customer behavior, purchasing patterns, and engagement metrics to gain insights into the reasons behind the decline in retention and lifetime value.

  • Identify key customer segments and their specific needs, preferences, and pain points to tailor personalised experiences and offerings.

  • Implement a loyalty program to incentivise repeat purchases and foster customer loyalty.

  • Enhance the customer service and support channels to ensure prompt and effective resolution of customer issues or concerns.

  • Utilise data-driven marketing strategies, such as targeted promotions and personalized recommendations, to increase engagement and encourage repeat purchases.

  • Continuously monitor and evaluate the impact of implemented strategies through metrics like customer retention rate, customer lifetime value, and repeat purchase rate, and make necessary adjustments to optimise results.

Note: The headings are just an aid for creation

When sharing the problem statement, I don’t use the ‘Situation’, ‘Complication’ and ‘Question’ headings and simply present it as a summary with the question highlighted.

We are experiencing a decline in customer retention and lower customer lifetime value. Our competition has intensified, with numerous online platforms offering similar products and services. Additionally, customer expectations and demands have evolved, requiring us to adapt and improve our strategies to retain customers and maximize their lifetime value.

What strategies can we apply and test to improve customer retention and increase customer lifetime value in our e-commerce business?