Chapter 4

Creative thinking
and Problem-
solving
INTRODUCTION
Business enterprises are under constant pressure to outperform their competitors and meet
shareholders’ expectations. In order to maintain their market position, business enterprises
need to find effective and creative solutions to problems. Entrepreneurs have to use problem
solving/creative thinking techniques to generate new and innovative ideas.
Overview
TOPIC CONTENT CONTENT DETAILS FOR
TEACHING, LEARNING AND
Creative thinking  Distinction between problem solving  Distinguish between
ASSESSMENT PURPOSES problem
and Problem- and decision making. solving and decision making.
 Steps in problem solving  Name/Outline/Apply the steps in
solving
 Apply creative thinking skills to solve problem-solving from given
complex business problems. scenarios/case studies.
 Benefits/advantages of creative thinking  Identify businesses challenges from
in the workplace. given scenarios and apply problem-
 Impact (positives/negatives) of creative solving techniques to solve
thinking/problem solving techniques. business problems.
 Application of creative thinking-/problem  Apply creative thinking skills to
solving techniques. solve complex business problems.
 Ways for businesses to create an  Explain the benefits/advantages of
environment that promotes creative creative thinking in the workplace.
thinking.  Discuss/Evaluate the impact
(positives/negatives) of creative
thinking/problem solving
techniques, e.g.:
o Delphi technique
o Force field analysis
o Brainstorming
o Mind mapping
o Nominal group technique
o SCAMPER
o Forced combination
o Empty chair
 Explain how businesses can apply
the above creative
thinking-/problem solving
techniques in the workplace.
 Suggest/Recommend ways in
which businesses can create an
environment that promotes creative
thinking.
4.1 Key concepts
These definitions will help you understand the meaning of key Business Studies concepts that are used in
this chapter

Term Definition
Creative To be original, inventive or resourceful.
Generate To produce or create.
Creativity/ Innovative Ideas featuring new and original methods.
Creative thinking The ability to think of original, varied new ideas or new approaches
Decision-making A judgement made a after thinking process.
Problem Experiencing uncertainty or difficulty in achieving what we want to achieve.
Problem-solving Gathering facts that include problem findings and problem shaping.
Problem-solving techniques Various problem solving techniques which businesses used to solve
business related problems.
4.2 Problem-solving and decision-making

Differences between problem-solving and decision-making

DECISION MAKING PROBLEM SOLVING
 It is often done by one person/a  Problems can be solved by a group/
member of senior management who team or an individual team member.
makes it authoritarian.
 Various alternatives are considered  Alternative solutions are generated/
before choosing the best one. identified and critically evaluated.
 It is part of the problem-solving cycle  Process of analysing a situation to
as decisions need to be made in each identify strategies to bring about
step. change.

Steps in problem-solving
 Identify the problem
 Define the problem/ determine the possible causes of the problem
 Identify alternative solutions
 Evaluate the alternative solutions and choose the best solution
 Formulate a strategy/action plan
 Implement the strategy
 Monitor the strategy
 Evaluate the problem-solving process

4.3 Creative thinking

Benefits/advantages of creative thinking
 Better/Unique/Unconventional ideas/solutions is generated.
 May give the business a competitive advantage if unusual/unique solutions/ ideas/strategies
are implemented.
 Complex business problems may be solved.
 Productivity increases as management/employees may quickly generate multiple ideas which
utilises time and money more effectively.
 Managers/Employees have more confidence as they can live up to their full potential.
 Managers will be better leaders as they will be able to handle/manage change(s) positively and
creatively.
 Managers/Employees can develop a completely new outlook, which may be applied to any
task(s) they may do.
 Leads to more positive attitudes as managers/employees feel that they have contributed
towards problem solving.
 Improves motivation amongst staff members.
 Managers/Employees have a feeling of great accomplishment and they will not resist/obstruct
the process once they solved a problem/contributed towards the success of the business.
 Management/employees may keep up with fast changing technology.
 Stimulates initiative from employees/managers, as they are continuously pushed out of their
comfort zone.
 Creativity may lead to new inventions which improves the general standard of living.

 Activity 1

1.1 Identify the problem-solving steps that are presented by each of the following statements:
1.1.1 Different options are considered before a decision is taken. (2)
1.1.2 The reason for employee’s poor performance is due to lack of skills. (2)
1.1.3 The business is using the identified strategies to solve the problem. (2)
1.2 Name other problem-solving steps (5)

1.3 Read scenario and answer the questions that follow.

JERRY CONSULTANTS (JC)
The management of Jerry Consultants always request employees to come up with new
ideas that assist them to increase sales. JC used creative thinking to identify the needs of
customers from diverse backgrounds. The employees feel confident and motivated as they
are involved in decision making. The business is able to keep up with fast changing
technology.

1.3.1 Quote FOUR advantages of creative thinking from the scenario above. (4)

1.3.2 Advise the management of JC on how to create an environment that stimulates

creative thinking. (8)

Answer to activity 1
1.1 Problem solving steps from the statements

1.1.1 Evaluate the alternative solutions and choose the best solution√√
1.1.2 Identify/Define the problem√√
1.1.3 Implement the strategy/ Strategy implementation√√ Max (6)

1.2 Other problem solving steps

 Define the problem/ determine the possible causes of the problem. √
 Identify alternative solutions√
 Formulate a strategy/action plan√
 Monitor the strategy√
 Evaluate the problem-solving process√ (5x1) (5)

1.3 Advantages of creative thinking from the scenario

 The management of Jerry Consultants always request employees to come up with new
ideas to assist them with increasing the sales levels.√
 JC used creative thinking to identify the needs of customers from diverse
backgrounds.√
 The employees feel confident and motivated as they are involved in decision making. √
 The business is able to keep up with fast changing technology. √ (4X1) (4)
 1.3.2 Ways in which businesses can create an environment that promotes creative
thinking.
 JC must emphasise the importance of creative thinking to ensure that all staff know that
their ideas will be heard.√√
 Encourage staff to come up with new ideas/opinions/solutions.√√
 Make time for brainstorming sessions to generate new ideas, e.g. regular workshops/follow
up sessions to build on one another's ideas.√√
 Place suggestion boxes around the workplace and keep communication channels open for
new ideas.√√
 JC should train staff in innovative techniques/creative problem solving skills/mind-
mapping/lateral thinking.√√
 Encourage job swops within the organisation/studying how other businesses are doing
things.√√
 Encourage alternative ways of working/doing things.√√
 Respond enthusiastically to all ideas and never let anyone feel less important.√√
 Reward creativity with incentive schemes for teams/individuals that come up with creative
ideas.√√
 Provide a working environment conducive to creativity, free from distractions.√√
Max (8)

The emphasis is on “ways”,

not necessarily advantages

4.4 Problem solving techniques

Brainstorming Individuals suggests new ideas randomly that are written on a flip chart in a
larger group without being criticised.
Mind- map A diagram where the main/core concept is in the centre and ideas are
developed into branches linked to the main concept.
Delphi Technique A group communication process to deal with a complex problem by panel of
experts.’
Force-field Analysis Exanimation of all forces for and all forces against a specific decision to bring
about change in an organisation.
Empty-chair Technique A role-play technique where problems are solved whilst taking to an empty
chair.
Nominal Group Technique Individuals are divided into smaller groups where individuals silently
brainstorm as many ideas as possible before sharing with the entire group.
Forced combination Break down and analyse a situation, then find a solution/s that best solves
identified aspects of the problem or design situation.
SCAMPER Technique The technique is based on the notion that everything new is a modification of
something that already exists.

Activity 2
2.1 Identify the problem-solving technique applicable to TGB Ltd in EACH statement below.

2.1.1 Employees are requested to sit in groups and suggest ideas on how to improve
business sales.

2.1.2 The company wants to consult experts on how to adapt the layout of the company for a
conservation awareness campaign.

2.1.3 The CEO wants to make a confidential decision by pretending to discuss these
problems with a non-existing person.

2.1.4 The business wants to change the design of their product and considers the pros and
cons of their decision.

2.1.5 The business asked employees for ideas to incorporate in the packaging of their
chocolate products with soccer concepts.
(10)

ANSWERS TO ACTIVITY 2
Problem solving technique from the statements
2.1.1 Brainstorming√√
2.1.2 Delphi technique √√
2.1.3 Empty chair technique √√
2.1.4 Forced-field analysis√√
2.1.5 Forced combinations √√ (10)
Application and evaluate the impact (positives/negatives) of advanced creative thinking / problem- solving skills
Problem-solving Technique Impact Application/How businesses use
Positives Negatives problem solving techniques
Force-field Analysis  The various factors supporting  It requires the participation of all  Consider the forces for and
and opposing a particular idea can business units and this is not always against a decision
be seen in a visual summary. possible. (pros/advantages and
 It can lead to goals that are better  It may not result in full consensus cons/disadvantages)
designed, and based on evidence. amongst the group.
 It is time-consuming which in turn can
be expensive.
Delphi technique  Experts give anonymous suggestions.  Sometimes there will be no consensus  Invite a panel of selected experts’
 They feel safe and can be more creative. between the respondents. to participate in the process.
 Experts can feed off each other's ideas.  The process is time consuming and  Carefully design the questionnaire
expensive. and send it to the panel.
Brainstorming  Stimulates creative thinking.  Can be dominated by one strong  Define the business problem
 People get ideas from others team member. clearly so that all participants
and build on them.  Shy members don’t contribute. can understand.
 No one is allowed to criticise any suggested  Members state possible
ideas. causes of the business
problems.
 Set a time limit for each
brainstorming session.
Nominal Group technique  Group members all participate.  Ideas may not converge and there  Divide the group into smaller
 Votes are anonymous and may be more may not be consensus. groups.
honest.  The chosen solution will not be  Identify the problem and make
 All the members have an equal say in the final always the best one. it clear to everybody.
decision.  Number the possibilities and
let everybody vote for the top 3
solutions.
 Decide on the best solution.
Mind mapping  Very easy to generate.  Quite complicated and too many  Organize thoughts.
 Stimulates thinking and brain activity. influences will make it very difficult  Summarize notes.
 Easy to remember. to find a solution.  Generate new ideas.
 Some people find mind maps too  Solve problems.
chaotic and messy.
Forced  Stimulates creativity.  People involved can feel inhibited by  Generate new ideas in a
combination  Allows people to think outside the box. how wild ideas can become. group.
Empty chair  Clarifies the problem  Limited creativity since only one  Make decision on your own.
 Solutions must be clearly justified. person’s view is really applied.
SCAMPER  It is easy to use.  Can lead to a lot of debate.  See things
 Stimulates objectivity.  Time consuming. differently.
 Helps to generate different ideas.