2020 in a Glance: Root Cause Analysis Tops The List

Date: January 20, 2021

From March to November this year, I had close to 10 online training sessions on this topic alone with many serious yet engaging conversations with my ever-enthusiastic participants. 

 

We discussed and applied root cause analysis to a wide range of current and past news and issues such as the frequent water supply disruptions in Klang Valley; Felda and Tabung Haji’s conundrum; Amazon’s production facility incident; the Hollywood movie-like explosion in Beirut; Covid-19 pandemic and the dead farm fishes incident in Penang just to name a few.

 

 Some important take-away for me as a facilitator: 

1. The subject on root cause is not as straightforward as it seems to many. The main reason for this dilemma came down to the lack of guidance and coaching from their superior on the true meaning and approach to root cause analysis in the context of assurance.

 

2. The myriad of root cause analysis contents available on the internet may be appealing and useful in its general application but not so for assurance related assignment.

 

3. People, policy, process and system are told as the main root cause category and are prominently featured in many of the audit reports. The Board and senior management are largely OK in accepting this categorization.

 

4. Many knew the importance of the COSO internal control model but still lacked that last bit to connect it to root cause analysis.

 

5. Those applying a structured Risk & Control Matrix (RCM) are more comfortable in comprehending and applying the root cause analysis concept that I shared.

 

6. Prioritizing root causes continues to be a challenge for many.

 

7. The internal auditors are mostly afraid or were trying to be diplomatic in not highlighting the obvious ie. people (management) competency problem as the main root cause for many of the audit issues uncovered. This reminds me of a wise AC Chairman once said that if we (IA) are not part of the solution, we better not be part of the problem!

 

8. Rendering audit recommendations that are not linked to the root causes identified. This reminds me of one of my unpleasant encounters with a Dr that gave me additional (expensive too) medicines that were not part of my diagnosis!

 

It was comforting for me to read some of the participants’ feedback that they found our conversation a new learning experience for them and they now understand the meaning of root cause better from the context of assurance.  

I look forward to the new year for more sharing sessions with others. 

 

Till then,

Stay Vigilant and Stay Healthy.