The term problem is used variously across professions and in daily conversation.  In business, it is more common to hear the term opportunity, with its positive implication of profit, than problem, which has negative connotations, much as it does in daily life.  On the other hand, engineers and some scientists see problem solving as essential to their profession and refer to themselves as problem solvers.  Yet there are other scientists who equate problem with application and claim that their work is not concerned with solving problems.  And most of us would be quite unsettled if our physician used the term opportunity rather than problem in reacting to our symptoms.  Recognizing this variance in meaning, I advocate a neutral definition of problem to allow wide applications.

At the simplest level, a problem is what you solve to get from point A to point B; from where you are (current state) to where you want to be (desired state).  The assumption is that point B is sufficiently ambitious that you cannot get there just by the momentum of what you are doing presently, by changing nothing.  In non-trivial circumstances, the most consequential problem to solve is usually not obvious.  Not all needed information is available, introducing ambiguity and uncertainty. You have to use what data is available, think, and use judgment to articulate or frame the problem that you believe will best take you from the current to the desired state. Judgment implies subjectivity so it is quite likely others may frame the problem differently in the same circumstances. Problem framing requires skill and the ability to persuade others.

As illustration, consider a long-successful company that has been losing share in major markets, its new product has yielded sales below expectations, new competitors are growing rapidly, and there are fears of tariff wars and slowing

growth globally . In these circumstances, how do you frame the problem solving which will take the company from its current troubled state to its desired state? No doubt, there are several, debatable ways to frame the most consequential problem.

What I have described using the term circumstances, others may describe using situation or phenomenon.  Whichever term is used, the point to remember is that circumstances, situation, or phenomenon are what you encounter.  Problem is what you frame.  The former exists independent of you; the latter emerges from your insight and judgment. 

These distinctions will become clearer in the next chapter.  There are, however, two more distinctions worth addressing: problem vs. opportunity and challenge.

Challenge is often used as a synonym for problem, referring to an undesired current situation that ought to be fixed.  For example, the absence of a treatment for Alzheimer’s disease is a challenge.  More recently, the term grand challenges has gained currency in some quarters to refer to big societal problems such as climate change, income inequality, economic growth with stagnant incomes for large segments of the population, lack of economic opportunities for the middle class, and others. 

Finally, the distinction between problem and opportunity.  Without going into academic debates and the literature on opportunity, the way the term is practiced most often in business is that it refers to an occasion to make money.  Hence, it is possible to pursue an opportunity that does not solve a worthwhile problem for society.  Because the two concepts are not the same, many big societal problems remain neglected because there is no opportunity to make enough profit from solving them.