With debate and controversy already emerging around some of the diagnoses proposed in the upcoming Diagnostic and Statistical Manual of Mental Disorders (DSM), Fifth Edition, it may be timely to review the concepts of diagnosis and formulation in mental health. Psychiatry has traditionally emphasized the importance of diagnostic categories, with the implication that these offer a reliable guide for treatment options and prediction of outcomes. Diagnosis has also been regarded historically as helpful from a research standpoint, allowing categorization of people by disorders in order to quantify outcomes, and facilitate discussion around interventions and etiology.
In reality, however, diagnosis alone may tell us little about causation of a psychiatric disorder. Diagnosis may also instruct us poorly about which form of intervention we should undertake, and offers no information about the person's experience of their disorder. Kendell and Jablensky  acknowledged that while diagnoses may be '...helpful working concepts for clinicians' (p.4), many are not 'valid', in the sense that they are not '...discrete entities with natural boundaries that separate them from other disorders' (p.4). Furthermore, Tarrier and Calam  noted that, as diagnoses in the DSM and the International Classification of Diseases (ICD-10) are often based on selecting from a list in which some items are present and others absent, it is possible for two people to have the same diagnosis with few, and in some cases, no symptoms in common.
Categorical diagnoses are perhaps most valuable for disorders in which there is greater homogeneity, where biomarker studies show some demonstrable patterns, and where categorical diagnosis guides treatment with a degree of accuracy. Unfortunately, few disorders in psychiatry match this description. Phenomena such as mood and personality disorders, psychoses, and anxiety disorders can be associated with a diversity of etiological factors including early childhood experiences, trauma, personality styles, family, interpersonal, lifestyle, medical, and social stressors, with each factor playing a greater or lesser role for each person. Understanding and incorporating these into an individualized treatment plan is an essential part of quality care, with failure to do so not only risking an ineffective outcome, but potentially impacting negatively on the therapeutic relationship and resulting in exacerbation of the person's symptomatology.
At least in part due to recognition of the limitations of diagnosis in mental health, the concept of formulation or case conceptualization has attracted increasing interest in recent years. Formulation has been defined as synthesizing the patient's experience with relevant clinical theory and research , as '...the bridge between assessment and treatment' [, p.210] and has been utilized for multiple disorders in children, adults and older adults. [6–8]. However, formulation may be particularly helpful for people who have not had an adequate response to traditional interventions, people who have Axis II disorders, or when comorbidity complicates which interventions should be utilized first [9, 10].
Formulation can serve a number of functions. These include: understanding significant etiological factors that have influenced the person's presentation; identifying key difficulties; guiding which interventions should be utilized and in what order; and anticipating challenges that may occur during the course of treatment [4, 6, 7, 11].