Project BASICS attempts to answer questions about which of the best reading and mathematics strategies will produce mastery learning for what types of students in terms of their individual characteristics and needs. It focuses on the discovery and implementation of alternative strategies for mastery learning with an innovative school setting. The overall objective is to provide solution strategies for students (K-3) to result in 90 percent of the project students achieving at the same mastery level as the top 20 percent of California students in normal classroom situations. The project seeks to resolve the problem of reading, communications skills, and mathematics deficiencies by using the seven basic steps of the scientific method in its system approach to education planning and problemsolving. This booklet, the third of a series, is devoted to step three: analyze problems for objectives. Subsequent booklets deal with the succeeding steps. Described are the steps taken to analyze the problems in the South Bay area. Since the process of analysis is used with problems or with systems, a systems analysis is followed based on these steps: (1) Perform mission analysis, (2) perform function analysis, (3) perform task analysis, and (4) perform method-means analysis. (Author/EA)