Internal auditors often struggle with the need to identify the source of issues and recommend corrective actions that solve problems at the root. Otherwise, they run the risk of making the mistake too many people make: Trying to fix symptoms only to discover that the problem occurs again and again.
The Five Whys is one of the simplest tools for root cause analysis. It is easy to use, and the approach consists of asking “why” multiple items, each of which probes further into the source of the problem. Edward Hodnett was correct when he stated: “If you do not ask the right questions, you do not get the right answers. A question asked in the right way often points to its own answer. Asking questions is the A-B-C of diagnosis. Only the inquiring mind solves problems.”
In general, “root cause analysis is defined as the identification of why an issue occurred (versus only identifying or reporting on the issue itself). In this context, an issue is defined as a problem, error, instance of noncompliance, or missed opportunity” (Practice Adv 2320-2). Internal auditors should deliver insight to their clients, and this means they must avoid superficial findings and recommendations, identifying instead the drivers causing operational issues.
The 5 Whys method is an iterative technique used to explore the cause-and-effect relationships underlying a problem. The primary goal of the technique is to determine the root cause of a defect or problem by repeating the question “Why?” The process is sequential, and each question forms the basis of the next question. The “5” refers to the typical number of iterations needed to resolve the problem, but identifying the root cause may take fewer or more times than five.
To illustrate the process, consider a scenario where there is water on what should otherwise be a dry floor.
Problem statement: There is water on the floor.
Why 1: Why is there water on the floor?
Answer: Because water leaked from the ceiling.
Solution: Mop up the floor to dry the water.
Consequence: Water may continue to fall on the floor, thus mopping the water is an inadequate solution to the problem. Therefore, we should ask “why?” again.
Why 2: Why did the water leak from the ceiling?
Answer: Because the pipe overhead has poor fittings and that is causing the water to leak.
Solution: We can stop there and repair the pipe, but we should probably ask “why?” again.
Why 3: Why does the pipe overhead have poor fittings?
Answer: Because the pipe was not installed properly.
Why 4: Why wasn’t the pipe installed properly?
Answer: Because the plumbing work was done by an unqualified plumber.
Why 5: Why did we use an unqualified plumber?
Answer: Due to poor vendor screening practices. The plumbing work was granted to the plumber through favoritism rather than skill and a proven history of good workmanship.
So, now we know what caused the water on the floor!
With this knowledge, we can now move forward to address the vendor contracting process to eliminate favoritism and not allow this plumber to do any additional work for the organization. If we stop at any of the preceding steps, we would continue to experience water leakage because that was merely a symptom of inadequate vendor selection and poor workmanship.
Let’s examine another example where the auditor notes that the Service Department is making mistakes when responding to customer requests.
Why 1: Why are these mistakes occurring?
Answer: Because instructions are given verbally.
Why 2: Why are instructions given verbally?
Answer: Because Customer Service employees are not using a service form and they want to dispatch the service employees quickly.
Why 3: Why aren’t Customer Service employees using a service form?
Answer: There is no service form in use to record the customer information. Employees take notes based on the phone call with the customer and proceed from there.
At this point, with 3 Whys we can see that the absence of a consistent method of capturing orders and communicating them to the Service Department is causing the problem. The problem can be fixed in several ways. If there are sufficient financial resources, a new order taking system can be bought and implemented. That would be ideal, especially if it interfaces with the inventory (for parts) and invoicing (for billing) systems. If that is not feasible or possible, then having a standardized form that is filled out while the Customer Service employee is in communication with the customer should help inform the service personnel what needs to be done.