This is one of the most often confused points in all of IT Service Management and ITIL. Part of the confusion comes from the fact that both words are used (at least in the English language) to express similar ideas. Each reference some kind of issue occurring that potentially could lead to human action. However, in ITIL words are more clearly defined and have particular contexts for usage.
Incident: Any unplanned event that causes, or may cause, a disruption or interruption to service delivery or quality
Problem: The cause of one or more incidents, events, alerts or situations
While Incidents have to do with disruption of delivery or quality, problems have to do with causes. From these distinct definitions we can see that not every incident would result in a problem, and not every problem even needs to be related to an incident. Keep in mind that “Incidents never grow up to be Problems.” The difficulty arises when we want a nice quantitative way of determining when to begin the Problem Management process. We look for some formula, algorithm, quantity or structure that acts as a clear objective indicator to begin the Problem Management process. Unfortunately this may not be the right approach to take.
What figures into when we should use a problem has to do with our desire to find the root cause of an occurrence. The trigger for starting the problem process, or even for determining if you have a problem, is the basic question of “Why?” Anytime anyone asks the question “why?” you have moved into the Problem Management process. The question could be generated from one incident, one event, a series or trend of incidents or events, a major incident, or even no incidents or events. The last situation results in proactive Problem Management. A desire to investigate our current delivery and quality capabilities may lead someone to ask “why?” and begin the process of determining root cause and a permanent fix.
Problem Management is much more subjective and qualitative in its nature than Incident Management, which is more objective and quantifiable. This is what leads to the confusion between the two. They should be seen as two sides of the same coin or two ends of a spectrum. They are complements to each other and should be done in parallel based on the need to understand situations from both an objective (Incident) and subjective (Problem) perspective.