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1
How to get into consulting?Practical guide how to pass the case part
2
Management consultants are brutally efficientOnly 5% of candidates get accepted to consulting
3
You will learn how to solve cases during the job interview to increase your chances of
getting the job
4
Useful techniques that you should master
Market estimation cases
Sales and marketing cases
Strategic casesOperational cases
Recruitment process
In this presentation I will show 6 things
5
This presentation will help you land a job in consulting or as a business analyst
6
More cases you can find in my on-line course where I show step by step how to solve cases
Click to check my course
How to get into consulting –Management Consulting Cases
$45$ 0
7
The ideal consultant
8
The ideal consultant has some important characteristics that help him survive the hostile environment he is usually working in
Analytical mind
Good at structuring and simplifying problems
Good listener that can easily interact with people
Independent
Fast
Diligent and hard working
Resilient / Robust especially to stress
Good presentation skills
Open-minded
Computer literacy at least at average level
9
Recruitment Process
10
How does the recruitment process look like?
11
The recruitment process is pretty long and the chances are relatively small. Only 5% of those that take the math test get the offer
Math / Analytical
Test
Interview with HR
1st
interview with a
consultant
2nd
interview with a
consultant
3rd
interview with a
consultant
Last interview – Partner /
Director
100% 30% 25% 20% 15% 5%% of candidate that move to next phase
12
Important items in the CV
13
There are things that you look for when you are browsing through the CVs
Top universities
Top performer
Languages
Internships
Living / Studying abroad
Additional project i.e. student organizations
Computer literacy
14
Most management consulting workers are recruited from business schools or exact science departments
Business Schools and Department of Economics
% of all candidates
▪ 70%
% of all workers
▪ 50%
Exact science (math, physics, computer science
▪ 15% ▪ 30%
Medicine ▪ 5% ▪ 10%
Others ▪ 10% ▪ 10%
15
Types of questions that you may expect
16
There are 6 main types of questions you will get during the interviews
Market size estimation
Sales and marketing cases
Strategy cases
Logical math quizzes
Operations cases
Managing people cases
17
Alternative ways to get into consulting
18
Recruitment is not the only way that you can get into consulting
Comments% of candidates recruited
Direct recruitment to specific position
▪ Used especially by big consulting firms▪ 50-70%
Internships
▪ Helps you progress faster later
▪ Can require also formal recruiting but more lenient than the usual one
▪ 10-30%
Closer cooperation with students and student organizations
▪ You can help consulting firm organize in events, participate in them
▪ Bigger firms have their brand ambassadors on universities
▪ 10-30%
Closer cooperation with the universities
▪ You can get involved in the cooperation
▪ Usually helps you at least to get internship at the firm
▪ 10-30%
19
Useful Techniques that you should master before the
interview
20
Bottom-up approach
21
…the one you will for sure use is bottom-up approach where you go from single (typical) consumer to market research
▪ First you should imagine the typical users
▪ Then you should try to guess his consumption level
▪ By estimating the number of typical users you and their consumption level you get the rough size of the market
22
…sometimes it makes sense to divide markets in segments and estimate them separately (i.e. average and typical users, women and man, people in different age groups or segmentation by lifestyle)
Segment A
Segment B
23
…lets do a simple example. Imagine that you want to make an application for franchised restaurants
▪ You pick the sample group / area you want to estimate i.e. city (here Warsaw)
▪ You count the number of all restaurants in the area
▪ For the chosen area you count the franchising restaurants
▪ You check the population of the whole country – here Poland
▪ Assuming similar density as in Warsaw you scale up the number of franchised restaurants proportionally to the population
24
…to make you better at this method imagine you want to sell home made dog food….. First you have to estimate how many dogs they are…..
▪ First you should pick your sample – can be your friends or neighbors
▪ Next step is to calculate how many dogs they have
▪ Once you have the number also calculate how many households they are in the sample
▪ It is now enough to know how many households there are in the country
▪ And assuming similar proportion as in your sample you scale up the number of dogs
+
25
…with the number of dogs you just have to estimate the number of food eaten per year by average dog…..and you get to the size of the food market
▪ We have the number of dogs in the whole country. Now we have to get from here to the dog food
▪ This requires us to estimate additionally how much food would average dog eat per year
▪ In this way using annual average consumption per dog and the estimated number of dogs we are able to estimate how much food is eaten every year in the country
+
26
Lets sum up the bottom-up approach
▪Bottom-up approach enables you to estimate within one minutes the indicative size of the market
▪ It is very good for the B2C markets
▪For better estimation you should segment customers and increase the sample size
27
Top-down approach
28
When to use top-down approach?
▪You know the size of the whole market
▪You are interested in a specific segment of the market
▪Segment is big enough
▪You are thinking about niche strategy or low cost strategy (market re-segmenting)
29
For a change lets see how it would work with top-down approach
▪ You use the total market size to get to the size of the segment in which you are interested
▪ You have to use some sort of sample measure
▪ By applying the result from the sample you can get to the size of the segment in which you are interested
30
… let’s use the top-down approach to estimate the market for science fiction books sold in Poland….
▪ You use the total number of books sold in your country
▪ Then you go to the bookstore that belongs to the biggest chain of bookstore and check what percentage of the shelves are take by science fiction books
▪ If you use this proportion to the whole market you should get the rough estimation of the science fiction book segment
31
Backward reasoning
32
Imagine that you were supposed to say how much you have to spend to create a company that has revenue of $ 100 M dollar Imagine that you were supposed to say how much you have to
spend to create a company that has revenue of $ 100 M dollar
33
You could use for that the so called backward reasoning
CC: Flickr; Cycle Track
34
Imagine that you were supposed to say how much you have to spend to create a company that has revenue of $ 100 M dollar
Total Costs$ 400 M
Cost of 1 lead$ 2 K
# of leads200 K
÷
% Conversion10%
x # of customers20 K
Average revenue per customer $ 5 K
Revenues $ 100 M
x
35
Compound effect
36
There are 2 types of compounding effect
Time related Operations related
▪ Even if the growth is small applied over long period of time gives big end-results
▪ A lot of small changes in many areas may produce a big end-results
# of customers Average revenue per customer
Revenues
x
+15%+20%
+38%
= 2,6 x StartStart x (1+10%)^10
37
Issue tree
38
Issue tree - general
Area of analysis
Area 1
Problem 1
Problem 2
Possible Reason 1
Possible Reason 2
Possible Reason 3
Possible Reason 4
Possible reasonsSuspected problemsAnalysis to be performed
Analysis 1
Analysis 2
Analysis 3
Analysis 4
39
Issue tree – example – chicken meat producer
Area of analysis
Transport
High costs of transport per ton of goods
Big level of waste and breakage in transport
Possible reasonsSuspected problemsAnalysis to be performed
Analysis of correlation between type of packaging and percentage of damaged
Analysis of time spent on the way and kilometers covered in that time
Analysis of designed routes, their length and the influence of possible changes
Analysis of fuel usage and kilometers covered by vehicles
Analysis of load carried on the way back
Badly designed routes
Too big fuel usage
No shipments on the way back
Low usage of resources
Badly designed method of packaging which makes the product prone to damage
Speed not adjusted to the product
Badly organized work and schedule of deliveries
Limitation on delivery time of finished goods
Analysis of level of overtime, daily organization of drivers work
Analysis of Clients’ preferences on delivery time
40
Opportunity tree
41
Opportunity tree
Gross Margin
Sales
% Gross Margin
% Front Margin
% Back Margin
# of transactions
ATV
Traffic
% conversion
▪ YouTube
▪ Ads on instagram
▪ Affiliation with bloggers
▪ Guest blogging
Opportunities
▪ Long form / Short form
▪ Reduction of delivery methods
▪ No account
▪ Emailing for people abandoning cart
▪ Upselling and Cross selling
▪ Free delivery for higher tickets
▪ Introduction of new categories
▪ Reducing number of suppliers
▪ Finding new suppliers
▪ Renegotiation
42
Cost drivers
43
Cost drivers are causing the cost to go or down
Cost of a Udemy course
Slide preparation
Recording and editing
# of slides
Cost of 1 hour
# of hours per 1 slide
# of lectures
Cost of 1 hour
# of minutes per 1 lecture
44
Lean manufacturing
45
* Sort,Set,Shine,Standardise,Sustain
** Total Productive Maintenance
*** Overall Equipment Efficiency
Kanban Kaizen Poka YokeProdukcja
gniazdowa
Zero defectsOEE***TPM**SMEDJust in time
Process
mapping
Continuous flow
managementStandaryzacja
pracyHeijitsu box
5S*
Lean Manufacturing is a philosophy of working with little waste and highest quality. It consists of many techniques that should be gradually mastered
46
OLE
47
Overall Labour Efficiency how much work there is in the work☺?
Workday
Time that you can devote
Time left for real workLack of work
100%
54%
OLE =
100 %
54 %
x
x
98%
Work
98%
37%
No work due to organizational issues
Movement
70%
Work well done
70 %
Liczba dostępnych
godzinlalka Stawka Godzinna
Dodatkowe przychody
48
Removing bottlenecks
49
Bottlenecks are dangerous as their hurt the efficiency of the whole system
50
What is the throughput of every system and where is the bottleneck?
Example 1
7 5 7
Example 2
5 10 20
Example 3
5 5 3
x Stage capacity
51
The are 4 rules that you should follow when it comes to bottlenecks
▪ Identify what is the bottleneck
▪ Increase its throughput by lowering the time needed for everything that goes through the bottleneck
▪ Add new resources to bottleneck
▪ Adjust everything to the bottleneck – so it works at the same pace
52
Imagine that you are working in a company working in a content marketing
Research topics for a post
Write a post Create illustrationEdit and modify
post, add illustration and schedule
20 5 7 10
# of post that can be done in a week by 1 person
▪ Speed up the writing process (faster typing, better tools, shortcuts for the most popular words)
xx
20 8 7 10
10 9 10 10▪ Make the researcher do also par time
writing and making illustration
▪ We have almost doubled the production of post with the same resources
▪ The same principles would apply if all the activities were done only by you – in this case it would mean that you should not do too much research and illustration but rather improve the typing speed and match the number of illustration and researches to your capacity in writing
▪ If you have no impact on the process (you are one of the guys above just doing his own part and your boss does not want to listen to you then simply do less – identify the bottleneck and adjust your speed to his speed.
▪ On the other hand if you are the bottleneck then speed up because the whole team depends on you.
53
Market size estimation
54
Market size estimation -Introduction
55
In those sort of cases they want to check a few things
▪ Can you structure a problem?
▪ How do you behave when confronted by things that you know nothing about?
▪ How do you fill in the gaps?
▪ Your approach to analyzes?
56
I will show you few examples
57
I recommend going on your own through cases before seeing the solution
Go through the lecture with the tasks and questions
Pause the course for 5 minutes and try to solve the problem on your own as if you were in a real interview
Go to the next lecture with solution and go carefully through it
Before going to next lecture compare your answer with what I have shown in the solution
Proceed with the next case
58
TV sets market
59
Imagine that you were asked to estimate the market for TV sets
What is meant here by “the market”? Annual sales or total ownership?
What is included in the TV sets (i.e. monitors are in or not)?
Do you want the market estimation to be in volumes or in values?
60
Let’s start by finding the main drivers for TV sets. We assume that it depends on the number of families. If we have the number of families and the number of TV per family we an estimate how many TVs are owned
# of families
# of TV set per family
# of TV sets owned by all families
x
61
To get from TVs owned to the number of TVs bough every year we need to assume how often TV are replaced
# of families
# of TV set per family
# of TV sets owned by all families
x
# of years of usage of a TV sets
÷Number of TV sold during the year
62
Once we have the number of TV sold we can calculate the value of the market
# of families
# of TV set per family
# of TV sets owned by all families
x
# of years of usage of a TV sets
÷Number of TV sold during the year
Average price per TV
Value of TV sets sold during the year
x
63
If you do not know the number of families you can estimate it using the total number of people
# of families
# of TV set per family
# of TV sets owned by all families
x
# of years of usage of a TV sets
÷Number of TV sold during the year
Average price per TV
Value of TV sets sold during the year
x
Total population Average size of a family
÷
64
Below how it would look like for Poland
10 M families in Poland
1 TV set per family
10 M TV sets owned
x
Every 4 years replacement of TV set
÷ 2.5 M of TV sets sold annually
USD 1 000 per TV SET
USD 2 500 M of sold TV sets
x
40 M people in Poland
4 people per family
÷
65
More cases you can find in my on-line course where I show step by step how to solve cases
Click to check my course
How to get into consulting –Management Consulting Cases
$45$ 0
66
Sales and marketing cases
67
Sales and marketing cases-Introduction
68
In those sort of cases they want to check a few things about you:
▪ What is your general knowledge about sales and marketing?
▪ How analytical and goal-oriented you are when it comes to sales?
▪ How innovative you can be in sales / marketing?
▪ Are you a good sales / marketing person?
69
Sales channels comparison
70
Imagine that as a consultant you were asked to analyze your client situation-FMCG producer that is using different channels of distribution. How would you check whether his using the right mix channels
Own shops
Retail chains
E-commerce
Marketplaces
Wholesalers
71
How would you check whether his using the right mix channels
What “right means”?What metrics you should look at to decide on the
right mix?
What are the strategic goals?
What would you do – next steps?
72
How would you check whether his using the right mix channels
What “right means”?
▪ Right = the most profitable
▪ Right = the most profitable, still close to the structure market
What metrics you should look at to decide on the
right mix?
What are the strategic goals?
What would you do – next steps?
▪ Net margin per channel
▪ % Net margin per channel
▪ Market share of specific channel
▪ Number of customers or middlemen in a specific channel
▪ % of revenues in a specific channel generated by top 3 players
▪ Have higher share in channels experience high growth and have chances to become significant in the next 3 years
▪ Have higher share in channels that are not consolidated and the middlemen or the customer does not have significant purchasing power
▪ Step 1: Get the data on sales, COGS and direct and indirect channel costs
▪ Step 2: Calculate the profitability on all levels for all channels
▪ Step 3: Get the data on the market: % share of specific channel, number of players in the specific channel, % of revenues in a specific channel generated by top 3 players
▪ Step 4: Find out the strategic goals
▪ Step 5: Compare and decided on targeted mix of channel
73
Potential for growth -retailer
74
Imagine that you are retailer with 200 stores in the whole country.
Gdańsk
Szcecin
Bydgoszcz
Poznań
Wrocław
Katowice
Łódź
Kraków Rzeszów
Kielce
Lublin
Warszawa
Białystok
Gdynia-Sopot
Gliwice
Olsztyn
Opole
Zielona
Góra
Current number of stores
75
How you would estimate the potential for growth?
What “growth means”?
▪ Build new store
▪ Like For Like growth (LFL, L4L)
What metrics you should use to decided whether to
build a new store in a specific place or not?
What are the strategic goals?
What would you do – next steps?
▪ You should first establish the capture area for every type of store. It can be defined as an area or number of potential customers
▪ Define the expected profitability per store
▪ For every city you should calculate the number of stores at the saturation point
▪ Is the Retailer willing to sacrifice profitability just to capture more market share?
▪ What market share it aims at?
▪ What are his limitation in-terms of capex
▪ Step 1: Get the data on number of stores per city, population per city and data needed to calculate the saturation point (i.e. the minimal number of customers per store)
▪ Step 2: Calculate saturation point per every city
▪ Step 3: Compare the current number of shops with the saturation point
▪ Step 4: Decide on the basis of saturation point and strategic goals what to do
76
Below how we would calculate whether it makes sense to build a new store in a specific city
Total population in the city
Minimal number of population per shop
Number of shops at saturation point
Current number of stores
÷
Built new shops till saturation point if you have money
>
Don’t build any new shops in this location
<
77
If we were talking about Warsaw we could see the following picture
1 000 K people in Warsaw
We need at least 100 K per store
10 6
÷÷÷
We can build 4 new stores but we have money only for 2
>
We haven’t reached saturation point
<
78
Number of stores by provinces
Gdańsk
Szcecin
Bydgoszcz
Poznań
Wrocław
Katowice
Łódź
Kraków Rzeszów
Kielce
Lublin
Warszawa
Białystok
Gdynia-Sopot
Gliwice
Olsztyn
Opole
Zielona
Góra
Targeted number of stores
Current number of stores
79
How to expand Retail brand
80
Imagine that you are a Retailers with 10 stores and very strong brand that are selling toys. How would you grow the business
Off-line retail chain Selling Toys
81
There are plenty of things you can do. Below some examples
Open more stores if below saturation point
Work on improving LFL
Introduce private label
Add new categories for kids i.e. Fashion
Enter new channels i.e. on-line
Grow by franchising your concept
Creating new formats i.e. Store in Store
82
More cases you can find in my on-line course where I show step by step how to solve cases
Click to check my course
How to get into consulting –Management Consulting Cases
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83
Strategy cases
84
KPIs for cinema
85
Imagine that you were responsible for managing the cinema. What KPIs metrics you would look at to see whether you are doing a good job?
86
You should first start by estimating the revenues of the cinema you are managing
# sold tickets
Average revenue per Ticket
Total revenuex
87
Average revenue per ticket depends on the price of the ticket as well as average additional purchase are people making
# sold tickets
Average revenue per Ticket
Total revenuex
Average price per ticket
Average additional purchase per ticket
+
88
Number of sold tickets depends on the capacity of the cinema (number of potential seats) as well as the percentage utilization of this space
# sold tickets
Average revenue per Ticket
Total revenuex
Average price per ticket
Average additional purchase per ticket
Total capacity in tickets
% Utilization
+
x
89
On the cost side we have rent and the salaries of the people
# sold tickets
Average revenue per Ticket
Total revenue Total Costsx
Average price per ticket
Average additional purchase per ticket
Total capacity in tickets
% Utilization
Rent
People +
+
x
90
Salaries depend on the number of people and average wages
# sold tickets
Average revenue per Ticket
Total revenue Total Costsx
Average price per ticket
Average additional purchase per ticket
Total capacity in tickets
% Utilization
Rent
People
# of People
Average wages
+
+
x
x
91
When we deduct from the revenues the costs we get roughly the EBITDA of the cinema that you manage
# sold tickets
Average revenue per Ticket
Total revenue Total Costsx
EBITDA per cinema
-
Average price per ticket
Average additional purchase per ticket
Total capacity in tickets
% Utilization
Rent
People
# of People
Average wages
+
+
x
x
92
Once you have all the KPIs and you can start wondering how to increase the EBITDA of your cinema
# sold tickets
Average revenue per Ticket
Total revenue Total Costsx
EBITDA per cinema
-
Average price per ticket
Average additional purchase per ticket
Total capacity in tickets
% Utilization
Rent
People
# of People
Average wages
+
+
x
x
93
IKEA Business model
94
IKEA is a well know brand selling furniture. On what do you think they make their money? Think about this and move to the next slide
95
IKEA has been very successful in implementing low cost model in furniture. Below how they did it
Model „big box” built outside the city center
Design
Consistent message
Diversified revenue streams
Operational excellence
Business scale
Retail
Acquisition
Activation
Retention
Revenue
Referral
96
More cases you can find in my on-line course where I show step by step how to solve cases
Click to check my course
How to get into consulting –Management Consulting Cases
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97
Math / Logical quizzes
98
9 balls
99
Imagine that you have 9 balls. One of them is slightly heavier. You have weights with scale that you can use 2 times
100
First you have to divide the balls in 3 groups
Group A
Group B
Group C
101
Then put two groups on the scale. Let’s imagine that you put Group A and Group B
Group A Group B
102
If the scale stay in balance it means that the heavier 1 ball is in group C
Group A Group B
103
If the scale is tilting at the group A side it means that the heavier ball is in group A
Group A
Group B
104
If the scale is tilting at the group B side it means that the heavier ball is in group B
Group AGroup B
105
Imagine that you have 9 balls. One of them is slightly heavier. You have weights with scale that you can use 2 times
Group A
Group B
Group C
106
Let’s assume that the scales were in balance. We get rid of group A and B. Every ball in group C gets its own unique number C1, C2, C3. We put C1 and C2 on the scales. If the scale remain in balance it means that C3 is heavier. If the scales tilt at whatever side the tilt is this will point to the heavier ball
C1 C2
107
Imagine that you have 9 balls. One of them is slightly heavier. You have weights with scale that you can use 2 times
108
To sum up we did it in 2 phases. In the 1st one we got rid of 6 balls. In the 2nd one we got the heavier ball out of three
Group A
Group B
Group C
C1 C2 C3
Phase 1 Phase 2
109
Operations cases
110
Content marketing agency -how to increase it's output?
111
Imagine that you are working in a company doing content marketing. How much post they can make and how you could improve it?
Research topics for a post
Write a post Create illustrationEdit and modify
post, add illustration and schedule
20 5 7 10
# of post that can be done in a week by 1 person
xx
112
Imagine that you are working in a company working in a content marketing
Research topics for a post
Write a post Create illustrationEdit and modify
post, add illustration and schedule
20 5 7 10
# of post that can be done in a week by 1 person
▪ Speed up the writing process (faster typing, better tools, shortcuts for the most popular words)
xx
20 8 7 10
10 9 10 10▪ Make the researcher do also par time
writing and making illustration
▪ We have almost doubled the production of post with the same resources
▪ The same principles would apply if all the activities were done only by you – in this case it would mean that you should not do too much research and illustration but rather improve the typing speed and match the number of illustration and researches to your capacity in writing
▪ If you have no impact on the process (you are one of the guys above just doing his own part and your boss does not want to listen to you then simply do less – identify the bottleneck and adjust your speed to his speed.
▪ On the other hand if you are the bottleneck then speed up because the whole team depends on you.
113
It will take you around 20 minutes to get to the cash till
Number of people in the queue
Time per 1 customer
Number of cash tilts
32 2.33
30 23 20.0
Time you will waitIn min
23.4
Number of people in the queue
x
Number of cash tilts
Time per 1 customer
114
More cases you can find in my on-line course where I show step by step how to solve cases
Click to check my course
How to get into consulting –Management Consulting Cases
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115
You can also find useful some tips on Excel
Essential Excel for Business Analysts and Consultants
A practical guide
presentation
116
Check also business modeling in Excel
Business modelsPractical guide for startups and entrepreneurs
presentation
117
I recommend also looking at some techniques to improve your business. Click on the cover below to go to the presentation
How to become world class analyst
A practical guide
presentation
118
….and how to perform market research
Market researchPractical guide for startups and entrepreneurs
presentation
119
Subscribe to our channels:
www
120
Check my extensive presentation on productivity hacks to see how you can me 10x more productive
Management consultant productivity hacks
How to be lazy and still get things done
presentation
121
If you need more detailed version on productivity hacks you can check our course on productivity hacks
Click to check my course
Management Consulting Productivity hacks
122
Check my presentation on restaurant business model to understand it properly
How to open a successful restaurantA practical guide
presentation
123
Check my presentation on on-line models to understand them properly
On-line Business ModeslA practical guide
presentation
124
For more check also my on-line course
Click to check my course
125
Check my presentation on starting and running consulting company
Start and run consulting companyA practical guide
presentation
126
There is an interesting summary of ways to test cheaply businesses
MVP – how to test your business idea without building the
productA practical guide
presentation