Case Interview Workshops

#2 – Understanding Business Situation

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The Johns Hopkins Business & Consulting Club

2014/10/7

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The JHBCC aims to introduce the Johns Hopkins community to the world of business and consulting by helping students and staff:

JHBCC is a resource for you to:Learn, practice, and network

Develop business knowledge and consulting skills through workshops, seminars, and bootcamps

Network with experienced professionals and established firms via case competitions and infosessions

Build valuable experiences in leadership, teamwork, & communication

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JHBCC has many exciting events this year. So stay tuned!

1. Bi-weekly Case Study Workshops (Fall & Spring)

2. Fall Mini-Case Competition (November 7, 2014)

3. Business and Consulting Bootcamp (February 2015)

4. Spring Biotech Case Competition (April 2015)

5. Recruiting Info-sessions (Fall & Spring)

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1. Understand the format of case interview

2. Learn to analyze a business situation

3. Discussion on how to prepare

Goals to achieve today

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Types of case interview question could vary a lot…

1. Growth:a. Top-line (revenue) growth

b. Bottom-line (profitability) growth

2. Business Situationsa. New products or services

b. Market entry

c. Competition

d. Pricing and valuation

e. Operations

3. Merger & Acquisitions

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The case questions could come from private, public and social sectors or totally unique…

1. Private: Advanced Electronics, Aerospace & Defense, Automotive, Chemical, CPG, Power & Gas, Financial, Healthcare, High Tech, Infrastructure, Media, Metal & Mining, Pharma, PE, Paper/Forest Products, Retail, Semiconductors, Telecommunication, Travel & Transport & Logistics1

2. Public/Social sector

3. Unique – “a thief at Manhattan looking for stores to rob”

Source:1. http://www.mckinsey.com/

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The good news - the format is almost same for all cases!

5 min

3-4 min

15-20 min

1-3 min

*Interviews can also be interviewer-led or interviewee-led

1. Establishing Background:1. Listening to the case

2. Understanding objectives

3. Clarifying questions

2. Structuring Approach: 1. Structuring in a MECE way

2. Hypothesizing

3. Prioritizing

3. Analysis1. Quantitatively analyzing

2. Qualitatively analyzing

4. Recommendation

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Example Business Situation Case: Wilderness Therapy Program Expansion

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Our client Great Outdoors is a small not-for-profit organization near Philadelphia, Pennsylvania. It provides outdoor experiences including adventure therapy and wilderness therapy (the use of wilderness expeditions for the purpose of therapeutic intervention) to help pre-teen and young adolescents. The nonprofit organization offers a range of different types of wilderness therapy programs, with a range of models and approaches.

Originally, Great Outdoors is primarily concerned with providing 10-15 day primitive camping and hiking trips for troubled teenagers. However, recently a friend of one of Great Outdoors’s founders asked the group to provide a shorter program for corporate executives, which was a great success in the first few iterations. The management of Great Outdoors has retained your consulting firm to make a recommendation on whether to expand Great Outdoors to create a full-fledged executive program. What would you recommend?

Case Prompt

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Our client Great Outdoors is a small not-for-profit organization near Philadelphia, Pennsylvania. It provides outdoor experiences including adventure therapy and wilderness therapy (the use of wilderness expeditions for the purpose of therapeutic intervention) to help pre-teen and young adolescents. The nonprofit organization offers a range of different types of wilderness therapy programs, with a range of models and approaches.

Originally, Great Outdoors is primarily concerned with providing 10-15 day primitive camping and hiking trips for troubled teenagers. However, recently a friend of one of Great Outdoors’s founders asked the group to provide a shorter program for corporate executives, which was a great success in the first few iterations. The management of Great Outdoors has retained your consulting firm to make a recommendation on whether to expand Great Outdoors to create a full-fledged executive program. What would you recommend?

Establish Background: Get client’s situation and complication

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Our client Great Outdoors is a small not-for-profit organization near Philadelphia, Pennsylvania. It provides outdoor experiences including adventure therapy and wilderness therapy (the use of wilderness expeditions for the purpose of therapeutic intervention) to help pre-teen and young adolescents. The nonprofit organization offers a range of different types of wilderness therapy programs, with a range of models and approaches.

Originally, Great Outdoors is primarily concerned with providing 10-15 day primitive camping and hiking trips for troubled teenagers. However, recently a friend of one of Great Outdoors’s founders asked the group to provide a shorter program for corporate executives, which was a great success in the first few iterations. The management of Great Outdoors has retained your consulting firm to make a recommendation on whether to expand Great Outdoors to create a full-fledged executive program. What would you recommend?

Establishing Background: Understand client’s objective

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1. What’s not-for-profit?

2. How does the adolescent program work?

3. How does the executive program work?

4. What do you mean by great success for executive program?

5. What’s ultimate objective of our client? Profitability? Consistency w/ its mission? Or something else?

Establish Background: Ask clarifying questions

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Structuring Your ApproachStart with a framework

Choose 3 – 4 areas that we should analyze

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Structuring Your ApproachCustomize a MECE roadmap

• Constraints on capacity

• Synergies or cannibalizations between the two programs

Operation

• P&L of adolescent programs

• P&L of executive programsEconomics

• What is Great Outdoors’ purpose?

• Constraints on engaging in commercial activity?

• What’s employees’ opinion?Mission

• Any competitors running similar executive programs?

• What will be their response to our program?Competitor

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Structuring Your ApproachUse Hypothesis to drive analysis

• Minimal constraints on capacity?

• Strong synergies between the two programs?

Operation

Synergy

• Profitable executive programs?

• Could financially support adolescent programs?

Economics

Benefit

• Minimal constraints on engaging in commercial activity?

• Could potentially get employees support?

Mission

Alignment

• No or weak competitors running similar programs?

• Client has stronger capability to win the competition?

Weak Competitor

Great Outdoors should pursue the executive program, given

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Structuring Your ApproachPrioritize your analysis

• Profitable executive programs?

• Possibly could financially benefit adolescent programs?

Economics

Benefit

• Minimal constraints on engaging in commercial activity?

• Could potentially get employees support?

Mission

Alignment

• Minimal constraints on capacity?

• Strong synergies between the two programs?

Operation

Synergy

• No or weak competitors running similar programs?

• Client has stronger capability to win the competition?

Weak Competitor

Great Outdoors should pursue the executive program, given

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Analysis: Quantitative analyzing economic benefit

Executive Adolescent

# participants per trip 15 8

Program fee per student $2,000 $800

Revenue

Days per trip 4 11

Costs (food, equipment, insurance, etc)

per student per day $200 $125

Subtotal

# of guides 4 2

Cost per guide per day $200 $150

Subtotal

Total Margin

Every executive program can be used to support two adolescent programs.

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Analysis: Qualitative analyzing

• Mission Alignment:

We are not aware of any rules stipulating what the organization can or can’t do. We don’t anticipate losing funding based on a decision here.

People who are motivated to help out a non-profit may be less willing to help if they feel that the organization has “sold out” to high-paying corporate customers.

• Operation synergy:

Cost/Operational Savings – May be slight.

We believe we can sell out our capacity at current prices. We don’t anticipate any synergy or cannibalizations between two programs.

• Competitor response:

Competitors are very fragmented, so a response is unlikely.

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Recommendation: Get client’s buy-in

Client should expand executive programs because of financial benefit, minimal risk for our mission and weak competitive landscape .

• Every executive program could financially support 2 adolescent programs, which will help improve the sustainability and scale of our client.

• Providing the executive program won’t jeopardize our client’s not-for-profit status.

• With fragmented competition landscape, our client could easily establish their position in the executive segment.

However, communicating this decision to stakeholders correctly is critical. We could communicate the financial benefit of executive program and the potential to advertise our program to a large pool of donors and philanthropists.

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Recap – the case solving process

5 min

3-4 min

15-20 min

1-3 min

*Interviews can also be interviewer-led or interviewee-led

1. Establishing Background:1. Listening to the case

2. Understanding objectives

3. Clarifying questions

2. Structuring Approach: 1. Structuring in a MECE way

2. Hypothesizing

3. Prioritizing

3. Analysis1. Quantitatively analyzing

2. Qualitatively analyzing

4. Recommendation