Managerial problem identification

OMEGA Int. J. of Mgmt So., Vol. 17, No. I, pp. 27-36, 1989

0305-0483/89 $3.00 +0.00 Copyright ~ 1989 Pergamon Press plc

Printed in Great Britain. All rights reserved

Managerial Problem Identification GF SMITH University of Minnesota, USA (Received May 1988; in revised form August 1988) Despite its importance in determining the set of concerns to be addressed by problem solving activity, managerial problem identification is not well understood. Theorists have variously accounted for identiflentinn in terms of individual cognitive processes, motivations, end organizational roles and procedures. But the important part which the problem itself plays in identification, through its observable manifestations, has been ignored. Empirical data concerning seventy organizational problems were collected and analyzed. The results indicate the importance of the problem and the evidence it provides for problem finding. Implications for further descriptive and prescriptive research are discussed.

INTRODUCTION

search suggesting that the cause of problem identification is often intrinsic to the problem itself.

GOAL-DIRECTED activity of individuals and organizations can usefully be regarded as problem solving. This implies that agents are aware of problems they hope to solve. Also denoted T H E O R E T I C A L B A C K G R O U N D AND problem finding, perception, recognition, and ANALYSIS sensing, problem identification is the process by While problems are commonly defined as which agents become aware of perplexities and dissatisfactions. Since problems serve to allocate existing state-desired state gaps [18], two other attention, problem identification determines the conditions are equally necessary for problem agenda of concerns that problem solving activ- existence: the gap must be difficult to bridge or ity will address. Identification failure can have close [24]; and it must be important, deserve to serious adverse consequences, as histories of be included in an individual's set of concerns. This leads to a definition resembling that of organizational disasters demonstrate [28]. The study of problem identification began Agre [l]: A problem is an undesirable situation with the work of Pounds [25]. It has benefited which is significant to and may be solvable by recently from increased interest in problem for- some agent, although probably with some mulation, particularly as applied to strategic difficulty. A problem is a relationship of disharmanagement [8, 17]. Cognitive analyses of mony between reality and one's preferences. problem identification have been proposed Being a relationship, it has no physical exis[5, 14], complementing research that stresses tence. Rather, problems are conceptual entities motivational [3] and procedural [6] aspects of or constructs serving an attention-allocation purpose. Marking some situation as probthe process. lematic places it on an agenda for future attenThe present paper seeks to explain the problem identification activities of managers and tion and solution efforts. Often regarded as other organization members. While the existing different from problems [23], 'crises' and 'opliterature contains several useful perspectives on portunities' share the defining f~atures of the problem identification, a key consideration-- problem construct and can be conceived of as the nature of problems and their manifes- problem types. Conceptualized as a phase-like process starttations-has been overlooked. The paper reports the results of exploratory empirical re- ing with identification of a problem and ending 27

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Smith--Managerial Problem Identification

with its solution, problem solving is the thinking done in response to problems. Many theorists denote the initial phases of this process as "problem formulation." This includes perceiving that a problem exists (problem identification) and determining what the problem involves (problem definition). Some regard formulation as including diagnosis of the problem's causes. While conceptual and empirical research has been done on problem formulation [15, 16, 17, 27], the results do not clearly apply to identification, since formulation combines identification, definition, and diagnosis. The present paper attempts to explain how individuals identify problems in organizational contexts. Since only conscious beings--humans, not organizations---can believe that a problem exists, the individual is the appropriate level of analysis for this research. Nonetheless, organizations affect human performance. As "interpretation systems" [7], they alter perceptions, making the identification of particular problems more or less likely. Moreover, organizations assign individuals to roles, the performance of which can involve problem identification. One can never neatly differentiate individual from organizational factors--in Yeats' [29, p. 214] terms, "know the dancer from the d a n c e " and this research acknowledges both sets of influences. The initial phase in the problem solving process, identification is not always neatly split from its successors. Nor is it always easy to determine when a problem was first identified [5]. For present purposes, a problem has been identified when an individual does or, upon reflection, would assert that the problem exists in the situation under consideration. Identificational claims, like problems, are partially subjective since they involve individual beliefs and preferences. One may wrongly believe that a problem exists, but only rarely can someone else prove that the belief is mistaken. Theoretical explanations of problem identification must provide convincing accounts of why particular problems were or were not identified. Much existingresearch describes the problem identification process, specifying variables that influence process outcomes. But description is not explanation, and influencing variables are not always plausible causes. This reflects the cause-condition distinction made by Mackie [19]. The presence of oxygen is a necessary

condition for starting a fire, but only rarely would one explain the occurrence of fire by citing oxygen as its cause. Causes are intrusive or unusual events, whereas conditions are normally expected states [9]. Thus, while cognitive processing is necessary for problem identification, a description of this processing is explanatory only when cognitive activities are the exceptional factor responsible for identificational success or failure. How, in general, might an instance of problem identification be explained? Human cognitive processes are one candidate. In the movie The China Syndrome, the operations manager of a nuclear power plant identified major structural flaws in the plant from having noticed the rippling of his coffee after an earth tremor. This extraordinary cognitive performance caused the problem to be identified. Another possible cause is an individual's role-related activity. If an organization member identified a problem as the result of performing an assigned function, e.g. reviewing operating reports, it is reasonable to regard that function as causing problem identification. Third, events can be explained in terms of individual purposes. In politicized contexts, the discovery or nondiscovery of a problem may result from personal motivations. Finally, a problem's identification might be accounted for in terms of the problem itself, its nature and resulting manifestations. One considers how the problem makes itself known, the stimuli or evidence it provides for identification. In some instances, a single cause will stand out as the active factor most responsible for identificational performance. In other cases, no one factor is decisive, causal influence being shared. Pounds' [25] influential study of problem finding described identification in terms of the models or standards of comparison organizations use to assess performance. While problems can not be identified without some desired state or model for comparison with reality, the models themselves, being passive, do not cause or explain identification. Combining Pounds' account with Cyert and March's [6] behavioral theory of the firm suggests an explanation in terms of aspiration level triggers: problems are identified when comparisons between actual performance and established aspiration levels indicate the existence of serious gaps. Problem identification is caused by the performance monitoring activities of individuals in organ-

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izations. Billings et al. [2] note that many problems are identified because organizations routinely collect and monitor data on certain indicators. Cowan's [5] cognitive model of problem recognition draws on the notions of "task-role schemas" and "informational situations," the organizational context in which individual cognition transpires. This research suggests how problem identification might be explained in terms of organizational roles and procedures. More idiosyncratic is the notion that problem identification can be caused by individual motivations. Cohen et al. [3, p.2] asserted that "choices look for problems." By identifying an appropriate problem, one can offer as its solution, and promote acceptance of, an action desired for reasons unrelated to the problem's existence. Problem identification becomes a means of advancing other interests and objectives. Empirical research supports this claim: Nutt [23, p. 433] identified a "pet idea model," and Mintzberg et al. [21, p.253] discerned a related "matching" phenomenon. Less consciously, individual preferences can affect problem identification by altering cognitive processing, as suggested by social motivation theory [14]. Most recent research has taken a cognitive approach, explaining problem identification in terms of individual cognitive activities. Many researchers have adopted a signal detection model, claiming that problems are identified when relevant stimuli are noticed and correctly interpreted against a background of irrelevant noise. Such models suggest threshold effects, making identification dependent on the magnitude of a perceived discrepancy and on the number and persistence of problematic stimuli. Given the importance of the interpretive process, these models also suggest the individual's prior experience [5] and cognitive style [15] as potential influences on identificational performance. Extending the popular stage models of problem solving, Cowan [5] offered a phasic representation of individual problem identification. Kiesler and Sproull [14] analyzed problem sensing from a social cognition standpoint. Notably absent in the literature are theoretical accounts or empirical studies which look to the problem as an explanation of its identification. Miller and Starr [20] are among the few to note "head-on confrontations" with prob-

lems that virtually make themselves known. Theoretical support for such can be found in the perceptual theories of James Gibson [10, l l]. Gibson attempted to explain perception in terms of the information made available by external stimuli, rather than internal cognitive processes. A Gibsonian approach draws attention to how problems enable identification, the cues or stimuli they provide for their recognition. These manifestations can explain many instances of identification, as when the problem is "just there," requires no special cognitive activity to be noticed, e.g. one's car won't start. Problem identification is often simply a matter of recognizing what the problem makes available and drawing obvious conclusions from those stimuli. EMPIRICAL RESEARCH Methodology

An exploratory investigation of managerial problem identification was conducted using 41 individuals employed by over 30 organizations as managers or in staff/technical positions. Subjects were asked to describe one or more problems they faced in their professional lives. A total of 70 problems were identified for use in this research. Through semi-structured interviews, individuals were asked about the nature of each problem and the way it was identified. Counted as a problem for this research are any existing state-desired state gaps indicated by a subject as both difficult and important. Most subjects claimed that identified problems were acknowledged as such in their organizations, but several admitted that some of their associates might not agree that a proposed problem actually existed. While uncertainty about a problem's existence was noted, this research takes all espoused problems as real. They presumably express subjects' beliefs and concerns which, if fallible, are nonetheless beyond the validating power of feasible investigations. Allowing that the problems specified by subjects were real concurrently admits that they had been identified. Initial identification might not have been made by the subject, but he/she agreed that the problem existed, and had some understanding of how or why it was identified. Although subjects had been instructed as to the defining characteristics of problems, their

Smith--Managerial Problem Identification

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Table I. Cause-category relationships Theoretical categories Empirical causes Pm'formance monitoring (23) Planning (12) Self-assessment (I 5) Diagnosis (10) Auditing (4) Motivations (0) Generalization (25) Induction (12) Salient stimuli (14) Direct 07) Complaints (14)

Roles and procedures

Individual motivations

Cognitive processes

X

X X X X X X X X X

knowledge of identification was more general and included none of the categories used to describe these data. Because accounts were collected individually, with no opportunity for inter-subject communication, each subject's description of problem identification is independent from those of his/her peers. Comparing this study to other identification research, several points bear mention. First, the present research is concerned with the full spectrum of organizational problems. The elicited set of problems exhibits great variety in terms of importance, functional area responsibility, and specific content. Most existing research has focused on strategic problems identified by senior executives. While this may be the most important category of problems, concentration on it can limit our understanding of problem identification. Second, the research elicited less detailed case histories of more problems than most previous work. This was motivated by situational constraints and the belief that intensive case studies had not yielded much insight into identification. Lyles and Mitroff, for instance, used semi-structured interviews with 33 senior managers to construct case histories of the formulation process, only to conclude that problem identification was based on "informal communication and intuition" [16, p.109]. Questioning of respondents may not reveal more than the current study if people do not categorize their experiences as "problem identification" and can not recall such when asked. Finally, this research is exploratory, intended more to develop grounded theory [12] than to test hypotheses. By way of contrast, Cowan proposed a cognitive model of problem recognition [5] and tested related hypotheses in an experiment [4]. It is felt that, exist-

Problem manifestations

X X X X X

ing contributions notwithstanding, a richer, empirically-based account of identification is needed to direct hypothesis formation and testing.

Data analysis Problem identification can be explained at three levels. The most general involves the explanatory categories discussed previously: organizational roles and procedures; individual motivations; cognitive processes; and problem manifestations. These categories are not mutually exclusive, in that an identification can involve more than one. Thus, performing assigned functions can entail cognitive activities shaped by observable stimuli. By considering specific instances of these, e.g. an auditing role, a second level of explanation is introduced. Most subjects explained problem identification at this level, suggesting 11 "causes" of identification. Each cause denotes a particular role/procedure, cognitive process, or manifestation. Only the motivation category is undifferentiated at the causal level, reflecting the lack of such explanations in subjects' accounts. Causes are connected to categories; the instantiation of a cause in a case suggests at least one category as effective. Table 1 relates observed causes to theoretical categories. A causecategory intersection is marked if the cause is a specific instance of the category, e.g. generalization is a kind of cognitive process. It is possible for a cause to have more than one categorical parent, e.g. diagnosis was observed as both a cognitive process and an organizational activity. Intersections are also marked if the data included cases where an ascribed cause clearly involved a non-parental category, as when identification through generalization is

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better explained by problematic stimuli than by cognitive processes. Next to each causal row variable in Table 1 is a number indicating the frequency with which this cause was observed. More than one cause could be relevant to a problem, due to the variety of cues and activities involved in its recognition. The final level of explanation considers influences that make a cause effective in a particular case. Thus, a cognitive cause like diagnosis might be effective due to the individual's prior experience. Few subjects noted such influences in their discussions, but several have been proposed in the literature and others were discerned during case analysis. In summary, the emerging model of problem identification includes situation-specific influences on the effectiveness of various causes. Individuals typically explain identification in terms of these causes, which connect to four explanatory categories. Because they are most directly evidenced in subjects' reports, data analysis begins with the indicated causes of problem identification. Each can be defined and exemplified as follows: Performance monitoring. Most of the problem finding discussed by Pounds [25] and other aspiration-level theorists falls in this category. Problems are identified as the result of formal or informal comparisons between actual performance and expectational standards. Formal monitoring was decisive in the detection of new product performance inadequacies (four cases); the financial losses of a real estate development project; and slow asset turnover. Informal monitoring contributed to the identification of inadequate job bidding practises; inefficient performance of an MIS department; and decline in market share. This was the second most frequently cited cause of identification. Planning. Planning involves attending to the likely and potential future conditions of an enterprise. Often an organizational process, planning can also be self-motivated cognitive activity. Due to its future orientation, planning promotes identification of opportunities and potential problems. Planning helped anticipate a client's discontinuation of an R&D project; a firm's need for venture capital financing; and the adverse impact of economic conditions on a financial services firm's clientele. Self-assessment. Self-assessment involves an evaluation of any aspect of the organization not amenable to performance monitoring. Inade-

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quote procedures for allocating information services costs; a latent weakness in a firm's marketing strategy; a city's lack of an economic development program; an inadequate new product development system; and design weaknesses of a newly developed information system: these problems would fall through the cracks of most performance monitoring efforts, but were identified through self-assessment. Diagnosis. Some problems are discovered as the result of investigations into the causes of known problems. Diagnosis is ad hoc, enacted as part of other problem solving efforts. Like planning and self-assessment, it can engender impressive cognitive performances. Investigation of a medical product's unsatisfactory sales growth led to the discovery of rapid turnover among prescribing physicians. An advertising agency, responding to client complaints that its new product was not selling, took the onus off its advertisement campaign through an investigation which disclosed inadequate product design and distribution. The unsatisfactory profit performance of a new product was ultimately traced to needlessly high quality standards. Auditing. Infrequently observed (four cases), auditing denotes processes by which organizations enforce and perfect controls. It can entail noteworthy cognitive activity, as when a subject discovered an obscure control inadequacy in corporate treasury operations. Most auditing is routinized: periodic reviews established that raw material usage was reported inaccurately; and an analyst noted that project start-up costs were handled improperly. Motivation. The sole motivational cause cited in this study was negative: concern over a real estate developer's lax credit and collection policies was retarded by management's reluctance to do anything that might lower sales. In nine other cases, one can speculate that motivational factors contributed to problem identification, since the individual or organizational subunit stood to benefit from the problem's perceived existence. Generalization. The most commonly observed cause of problem identification, this term refers to situations in which various stimuli are mentioned as contributing to problem awareness, identification resulting from generalization over these stimuli. A problem is inferred because its existence provides a coherent account of diverse

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Smith mManagerial Problem Identification

facts. While generalization is a cognitive process, identifications may owe more to the salience and interpretability of stimuli than to cognitive activities. Problems identified include ineffective performance of a department, inadequate project management, poor information systems services, and unmotivated employees. Induction. A problem is identified inductively from a succession of like occurrences, each undesirable but not important enough to be regarded as a problem itself. High personnel turnover was recognized by induction over frequent instances of employees quitting (three cases). Routine violations of procedures resulted in inductive identifications (three cases). Other instances involved inadequate procedures: job bidding practises, billing and collection methods, processing of information requests. Salient stimuli. Some problems are evidenced by salient cues, occurring inevitably or by accident, that are not readily interpretable. Their conspicuousness insures that these cues are noticed and accounted for. Observations of excessive scrap contributed to the recognition that a product's quality standards were inappropriate. A corporation realized that inter-divisional competition had got out of hand after an embarrassing incident in which two divisions aggressively bid against each other for a customer's business. Direct. Direct identification occurs when a problem makes itself known. The problem generates overt, readily understood, stimuli that make it almost impossible for the problem not to be identified. Cases include an excessive individual workload (two); customers' unwillingness to try a new product (two); and an employee's refusal to perform an assigned task. Decision problems are often identified directly, as when a position's availability forced a manager to decide which of two employees to promote. Complaints. Equally direct are complaints, arising when a problem affects agents who are willing and able to express dissatisfaction. Common complainants include customers, employees, superiors, and organizational subunits. Customer complaints about the price of a product fostered concern over its manufacturing cost. Employee objections to excessive workloads led to an awareness that a department was understaffed. User complaints about excessive

information service costs resulted in evaluation of the allocation procedure and of information service's overall effectiveness. Since observed causes are systematically related to theoretical categories (Table 1), they can be used to characterize identification in terms of the higher level constructs. It is assumed that problem identification is an additive function of three theoretical categories (no subjects mentioned motivation as a cause of identification). Based on subjects' causal accounts, proportion weights were assigned to categories reflecting their relative importance in explaining the identification of each problem. The resulting indices are assumed reliable at an ordinal level of measurement. For instance, identification of a decline in a manufacturer's share of its service parts after-market had the following causes: complaints by distributors about price-cutting by generic parts manufacturers; performance data obtained through information systems indicating lower-thanexpected service parts sales; trade journal references to producers of generic parts; and the subject's investigation, aided by a realization that generic manufacturers often skimmed parts after-markets in consumer durables industries. Given these causes of identification, 50 of 100 identification points were assigned to the cognitive process category, with 30 being allocated to problem manifestations and 20 to organizational factors. The mean index values over these 70 problems were 48, 26, and 26 for manifestations, cognitive, and organizational factors respectively. While all the problems used in this research had been identified as such, there was variation in identificational decisiveness, some problems being more obvious than others. This Variation was considered, with the aforementioned indices, in developing ordinal rankings of problems within each of the three theoretical categories. These rankings reflect the relative identificational impact of a category across problems. Thus, the top-ranked problem in the cognitive processes category was that for which cognitive processes had the most effect on a problem's identification, this effect showing up in both a clear-cut identification and a high weighting of cognitive processes, vis-~-~'is other categories, for that problem. As might be expected, there is a significant negative correlation between the manifestations and cognitive processes rankings

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(Kendall's tau = -0.387, P < 0.001), as well as between the former and organizational influences (tau = -0.316, P < 0.001). Cognitive processes and organizational influences were not correlated. Using index values to assign problems to primary identification categories, 36 cases,.just over half, had problem manifestations as the strongest factor in their identification, with 21 being best explained by cognitive, and 13 by organizational effects. Problems in each of the primary identification categories can be characterized as follows: Problem manifestations. Ten of these 36 problems were identified directly. Salient stimuli (4) and complaints (6) provided additional identifications. Also important were generalization (8) and induction (4); these were cases in which problems provided enough evidence to render interpretive cognitive processes of secondary identificational importance. Cognitive processes. The three major subgroups in this category involved diagnosis (7), self-assessment (5), and planning (5) processes. Individual cognitive contributions are most influential when one is trying to determine the causal origins of an acknowledged problem; evaluating some aspect of the organization; and when planning leads to the anticipation of potential problems. There was a case of generalization in which cognitive contributions outweighed problem manifestations, and an auditing-derived identification that hinged more on individual thinking than on organizational procedures. Organizational roles and procedures. Nine problems in this category were identified through formal or informal performance monitoring. This activity requires little of the identifier but often depends on the generation of stimuli, e.g. sales invoices, accessible to performance monitoring systems. Planning and auditing were each responsible for two identifications, cases in which organizational effects dominated individual contributions. Regarding the third and most basic level of explanation, three classes of influence on problem identification have been Suggested in the literature--individual, organizational, and problem-related. Lyles and MitroWs [16] argument that managers' personal characteristics are dominant influences in problem formulation seems inapplicable to problem identification,

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witness the finding that problem characteristics best explain identificational success. A factor that may be relevant is availability of attention [26]. The research disclosed several cases in which problems were ignored because individuals or subunits had their hands full. Since the problem construct serves an attention-allocation function, its invocation could be restricted by unavailability of attention. Another notable individual variable is prior experience. This enables one to notice and interpret cues that others do not recognize as problematic. A newly hired manager of city economic development saw that current ED efforts were ineffective; and a systems analyst realized that the system developed under the purview of less experienced associates had no chance of satisfying user needs. Another kind of experience-close personal involvement with the situationw also contributes to identification. Problems like an excessive workload or the displeasing managerial style of a new boss are noticed because of their direct personal effects. One of the organizational factors influencing problem identification is locus of responsibility: problems having well-defined organizational homes will be identified more reliably than "orphans," cross-functional concerns that lack an overseer. A company purchased personal computers for its management and staff, but ncglected to institute a user support function, so that much of its investment ended up unproductively in office corners. Because no subunit was assigned responsibility, user support needs found place in no one's stack of concerns. Another influcncc on identification is data availability. When the performance of subunits or functions is readily monitored by information systems, as with products or operating divisions, problem identification is prompt and routine. When performance is less easily measurcdwan MIS department, job bidding practises, an R&D area--problem identification is slower, less decisive, and requires greater cognitive contributions. Lyles and Mitroff [16] claimed that problem formulation is more crucial for strategic problems, since they tend to be unstructured. Relatedly, it could be argued that strategic problems require greater cognitive contributions for identification than lower level problems. This supposition was tested by ranking the seventy problems in order of importance and computing

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correlations between this ranking and those for the three identification categories. While cognitive process identification was positively correlated with problem importance (Kendalrs tau = 0.157, P < 0.05), a stronger relationship was exhibited between organizational factors and importance (tau =0.300, P <0.001). Importance was negatively correlated with manifestation-based identification ( t a u = - 0 . 2 2 4 , P <0.01). It appears that strategic problems place greater identificational demands on individuals and, even more so, on organizational roles and procedures. However, the modest measures of association indicate the limited value of problem importance in explaining identification. The final set of influences on problem identification includes factors intrinsic to the problem itself. Degree of structure might influence identification, less structured problems requiring greater cognitive contributions towards their recognition. This possibility was not tested in the current study because of varying notions of problem structure and the difficulty of measuring each. If structure is conceptualized as clarity of problem definition, then the hypothesized effect on identification is plausible: problems resist definition for the same reasons they resist recognition: they aren't manifested in salient, interpretable, stimuli. But if structure is conceptualized as inadequate knowledge of how to solve the problem, a structure-identification relationship seems unlikely. A grocery chain's refusal to carry a dairy company's product line was directly identified by the subject, but the problem was highly unstructured in that there was no obviously effective solution strategy. Another influence often cited in the literature involves the problem-opportunity-crisis distinction, it being proposed that these are identified in different ways [5, 21,23]. The present data included no crises (situations involving large potential losses and intense tim e pressure) and only two opportunities (occasions for selfinitiated potential improvements from a tolerable status quo), so they do not bear on this issue. But the matter may be misconceived. The time pressure definitive of crises rules out situations that slowly emerge as problematic concerns, but do not otherwise bias identification methods. The opportunity-problem distinction really involves two dimensions: 'goods' vs 'bads,' and 'actuals' vs 'potentials.' Problems

are both actual and potential bads; opportunities are potential goods. The good-bad distinction should not affect identification, save through the attitudinal biases of individuals [8]. But actual and potential concerns are likely to be identified in different ways, since the former have more observable manifestations. The identification of both opportunities and potential problems should depend on individual cognitivc contributions. A total of nine potential problems and opportunities were included in the present data, of which six (67%) were identified primarily through cognitive processes. Only 25% of the actual problems were identified by cognitive means. Planning and self-assessment commonly cause the identification of potential problems/opportunities. Arguably the key influences on a problem's identification arc various conditions intrinsic to the problem itself. Its idcntificational category is determined by the causes responsible for the problem's discovery. These become operative in view of conditions more or less intrinsic to the problem's existence. A problem can be identified as the result of complaints, but only if the problem affects parties who arc willing and able to express their dissatisfaction. Similarly, a turnover problem consists in recurring voluntary terminations of valued personnel. The recurrence of such events is definitive of the problem and is the primary evidence for an inductive identification. Self-initiated activities--new products, systems, or ventures--are salient to initiators and arc monitored so that performance problems arc quickly identified. Attention flows to important issues: the latent weakness in a firm's marketing strategy might not have been discovered if its expensive advertising program was not under review. Problems involving measurable activities are relatively easy to identify, being amenable to performance monitoring systems. The inadequacies of a firm's financial performance are readily seen as problems, but the weakness of an R&D department arc not. Procedurally codified activities are monitored more easily than less structured functions. Problems promote identification by means characteristic of their natures. SUMMARY AND CONCLUSIONS Theories of problem identifcation have variously stressed the role of individual cognitions,

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motivations, and organizational procedures. While each explains the identification of certain problems, many cases are best accounted for by reference to the problem itself, the cues it manifests. Although problem characteristics have not been featured in existing theories, this paper presents data indicating such to be a significant factor in the identification of organizational problems. Seventy problems were studied, with identification being accounted for at three levels: theoretical categories providing general explanations of identification; identificational causes that subjects used to explain how their problems were found; and influencing factors that underly these causes and condition their effectiveness. Problem manifestations was the dominant explanatory category in just over half the cases, with cognitive and organizational accounts splitting the remainder. Many problems were identified directly or as the result of complaints, clear cases in which the problem fosters its identification. Inductive or generalization-based identifications usually depended more on observable stimuli than on the identifier's cognitive performance. Cognitive processes proved critical when planning, diagnosis, and self-assessment led to identification. Organizational performance monitoring procedures were another prevalent cause of problem finding. Consideration of the problem and its manifestations has heretofore been absent in theories of problem identification. This oversight may reflect a "fundamental attribution error" [22] on the part of theorists. Like most observers of human behavior, they explain performance in terms of person-related variables, rather than the situational factors that actors themselves regard as decisive. As the present data indicates, few people cite their cognitive processes as explanations of problem identification. While such processing goes on, it is usually a condition for, rather than a cause of, performance outcomes. Ultimately it doesn't matter which factor--individual or problem--is most causal: both are necessarily involved. The central issue for descriptive research is specification of the circumstances and activities that enable or prevent identificational success. Where does this leave us prescriptively? Kiesler and Sproull [14] criticized the "conventional wisdom on problem sensing" which prescribes that individuals and organizations

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learn from experience, plan, and increase the speed and range of information flows. This advice is often nonoperational--Can one decide henceforth to learn from experience?--and assumes availability of attention for planning and perusing information that managers simply do not have. Cognitive theories of problem identification promote individual training as a remedy [5], without providing the focused content that effective training presumes. Many of the weaknesses of existing prescriptions derive from an inadequate appreciation of the problem's role in identification. Unable to conditionalize recommendations on relevant problem characteristics, theorists are unable to offer pointed prescriptions. The picture emerging from the current study suggests another prescriptive approach. First, many problems literally make themselves known, so that prescriptions are unnecessary. Second, organizations have developed roles and procedures, often in response to past identificational failures, that presumably evolve into effective identification mechanisms. While such procedures can be improved, organizational experience is better evidence than theoretical argument as to what improvements are needed. What researchers can do, however, is to analyze identificational failures across organizations so that each can learn from the experience of others. Having determined which kinds of problems commonly fail effective identification, theorists will be able to analyze the manifestations of these problems, in light of human capacities and organizational mechanisms. This enables prescriptions involving focused training and the establishment of new roles and procedures. Much must be done before these prescriptive activities become feasible. Theorists must determine which kinds of problems typically fail to be identified successfully and at greatest cost to the organization. Also of interest is the incidence of "false positives," situations where problems presumed to exist turn out not to merit attention. Specification of these, and of any cues differentiating them from authentic problems, would be valuable. Other research opportunities concern the cognitive and motivational aspects of problem identification. Empirical research might find that identifications involving complex interpretive processes are prone to characteristic errors of inference and judgment [13]; training may be effective in

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Smith--Managerial Problem Identification

the mitigation of such. Certainly the theoretical framework presented herein bears further conceptual and empirical elaboration. The cited causes of identification and the influences conditioning them can be refined and augmented by additional empirical research. The theory that emerges is likely to have more explanatory richness, and perhaps a degree of predictive power. REFERENCES

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