Ace the Case - Warwick Consulting Societywarwickconsultingsociety.com/wp-content/...the-Case... · Cracking the Case A Rough Guide to Case Interviews ... which isn’t necessarily

Cracking the Case

A Rough Guide to Case Interviews

© OC&C Strategy Consultants 2011 2

Case interviews are used by OC&C as a way of separating the really great candidates from the very many high-calibre applicants that we get each year

We think that coming into these interviews with an understanding of what is expected of you makes for a much more engaging debate, and allows you to better show us what you can do

To help with this, we’ve pulled together a short guide to case interviews, including:

– A few reasons why OC&C use case interviews

– A short outline of the steps to solving a case

– Top tips for candidates, collated from some of our interviewers and from successful candidates

– Some worked examples of questions you might come across in interviews

We’ve also included some background on OC&C to help you understand about us and how we are different

We hope you find this helpful, and especially hope to see you across an interview table soon!

We want applicants to come into case interviews knowing what to expect – this makes for a much better debate and exchange of ideas

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Purpose of This Document

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Introduction to OC&C

How to Approach Case Studies

Frameworks and An Example Case

How to Apply to OC&C

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OC&C is a leading strategy consultancy, founded in London 28 years ago

OC&C’s Global Reach

OC&C’s success has translated into consistent growth for our business Founded in 1987 Currently, 14 offices worldwide and more

than 75 partners Global coverage through our hubs Our client roster includes some of the

largest corporations and most innovative challengers in the world

Background

Mumbai Boston Shanghai New Delhi Hong Kong

London Paris Düsseldorf Hamburg Rotterdam Warsaw Istanbul

Belo Horizonte São Paulo

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We work with senior management teams on a range of strategically critical issues

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Corporate clients and private equity

Big and small deals across sectors

Typically 3 – 6 weeks Advising on: Whether to buy Potential for growth Post acquisition strategy

Long term client relationships

The biggest UK and international companies

Typically 8 – 16 weeks Making companies lean and fit:

Realising Change Reducing Complexity Building new capabilities

Top UK and international companies

Senior management

Typically 4 – 8 weeks Answering the big questions:

How to grow? How to develop? How to compete?

Transactions / M&A Business Transformation Strategy

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Why OC&C

Market-leading Rewards

Entrepreneurial Culture

Strategy and Sector

Specialists

Rapid Progress

Top-quartile remuneration and training

Extra curricular benefits including Personal Development Banks, sponsored MBAs, our annual away weekend, International Training Week, team dinners, and much more

Still growing rapidly, with plenty of opportunity for you to contribute to that growth eg by spending time helping establish a new office or getting involved in running the firm

Friendly and informal across all levels of the firm – around the office, at the Xbox, and after work in the local bar

Strategy specialists: we don’t do long IT implementations and never will

More, shorter projects giving exposure to a huge variety of issues, industries and clients

Focus on a subset of industries: the ones that we find most interesting

Contributing to solving our client’s toughest problems from day one

Continuous feedback and formal 6-monthly appraisals

An unrivalled development environment: you will be continuously stretched

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Agenda

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Case interviews are a microcosm of a real project, so are a great way for us and for you to evaluate your fit with strategy consulting

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Gives an insight into the type of work we do, the sectors we operate in and the kind of problems we solve

Case interviews are a great way to understand what consulting projects look and feel like

– Can be a good, early-indicator of whether consulting is right for you

– If you don’t enjoy solving problems during a case interview, it may be an indication that you will not enjoy the type of work that we do

Case interviews make for a much more interesting conversation than the alternatives

Opportunity to see how a candidate thinks about business problems and test a candidate’s problem solving ability and skills in:

– Structured, logical thinking

– Issue Identification

– Analysis

– Creativity

– Business Judgement

– Numerical Ability

– Communication

Benefits of case interviews for you... Benefits of case interviews for us...

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There are four basic steps you should go through when tackling any case

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Listen and Clarify Structure Analyse Conclude

Make sure you understand the question:

Listen carefully

Take notes if it helps you

Ask clarifying questions as needed

Take time to evaluate the information given

Think about how you are going to solve the problem before diving in:

Structure problem

Identify key issues and prioritise

Formulate an initial hypothesis / hypotheses

Articulate approach and hypothesis

Gather the information you need to solve the case:

Ask questions and collect information

Develop, test and refine hypothesis

Hone in on the solution

Verbalise your thought process

Wrap-up your findings into clear recommendations:

Summarise your findings and draw out key facts

Don’t just repeat the answers to your analysis – ask yourself “so what?”

Make clear recommendations

Add next steps

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The key to solving any case is to apply intelligence, creativity and common sense in a structured way

We do not expect you to know anything about business beyond what an observant and well-read undergraduate will have picked up in their normal lives

However, if you want to hone your business sense, we would encourage you to read and think about some businesses you are interested in and look at some sample case interviews (see later for an example and some recommended sources)

Another way to practise is to understand some of the common business “frameworks” eg,

– Profit = Revenue - Cost = Price x Volume - Cost

– Market drivers analysis

– Segmentation

– Value/activity chain analysis

– Porter’s 5 Forces

However, interviewees can fixate on a framework – often the first one which pops into their head which isn’t necessarily appropriate to the case in question: frameworks are no substitute for thinking!

However, cracking a case isn’t about following a process: you will need intelligence, creativity, common sense ... and some elementary business knowledge

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You can see worked examples of some of these later in this document, or read about them online

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Finally, some top tips from our interviewers...

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Worry about getting the ‘right answer’; it’s much more about your thought process and logical reasoning

Panic if you are stuck or make a mistake – we all do. The important thing is that you recover and move on

Get bogged down in the details or stuck at one topic (watch out for the interviewer’s hints to move on)

Take an overly complex approach to the problem – keep it simple

Ask for information that you do not need

Worry if you did not finish the case; this happens often and does not mean you performed badly

Forget to check your numbers (do a sanity check!)

Force a framework onto a problem

Ask clarifying questions if you are unsure about something or need additional information about a unfamiliar market or industry – there’s nothing more frustrating than someone racing off in completely the wrong direction

Figure out how you are going to approach the problem before you dive in to the analysis

Think out loud so that the interviewer can follow your thoughts

Write down information that you may need later

Use paper to draw out your structure and calculations

State your assumptions clearly as you go along

Focus on the important 20% that solves 80% of the problem

Don't Do

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... and some words of advice from recent successful candidates

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“When solving a case, think about the business as if it were your own – What would I do if this were my business?”

“Take the time to think, and have confidence in your ideas. Defend your logic if questioned!”

“... but if you’re actually told that you are going in the wrong direction, then drop it and move on”

“Talk your thoughts during the interview”

“Practice cases with your friends or – even better – a friend who works in consulting”

“Don’t just dive for an answer, structure your thinking and use the discussion to be creative and explore ideas with your interviewer”

“Listen carefully, and take a hint”

“Practice doing simple math on paper and mentally, and don’t forget to round to simpler numbers”

“When market sizing, use your own experiences and frame of reference”

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Example Framework #1 How to apply ‘profit = revenue - cost’ ... to Swedish furniture

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The problem: Swedish Furniture Co’s profitability has been declining over the past two years. Please use the facts provided to identify where the problem lies

The approach: use the profit = revenue – costs framework to structure your thoughts...

Profit has fallen

Revenues have been falling

Costs have been rising

Fixed costs don’t appear to have moved

Variable costs have risen

Sales volumes have fallen

No evidence of change in prices

“The Krona has strengthened”

... hurting our export competitiveness

“Competitors have discounted”

... causing market share loss

“New logging restrictions”

... have increased wood prices

“Trade union action”

... has increased wages

... and to translate the facts provided (in italics) into their implications for profit

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Golf is played by 10% of the UK population

Golf is played from April to October. There are ‘regular players’ and ‘infrequent

players’ – Regular players play 4 rounds per month

and represent 30% of players – Infrequent players play 1 round per month

and represent 70% of players On average, a player loses one ball per round

they play

An average golf ball costs 50p (we will assume here that regular and infrequent players buy the same balls

Example Framework #2 How to apply ‘market sizing’ ... to golf balls

# of Customers Targeted

# Usage Occasions per

Year

# Purchases per Usage Occasion

Price per Unit

Total Sales in Market

Determine the estimated number of

customers in your market

Think about their usage / purchase behaviour, and

whether there are any distinct segments of

customers

Estimate the price the customer might may

per unit

60m population x 10% = 6m players Regular player 6m players x 30% = 2.4 m regular players 5 months x 4 rounds = 20 rounds per year => approx 48m golf balls to replace Infrequent player 6m players x 70% = 5.6m seldom players 5 months x 1 round = 5 rounds per year => approx 28m golf balls to replace (28m + 48m) x 50p = £38m per year

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The problem: As part of our study of the UK golf market, estimate the market size for golf balls

The approach: use a market sizing framework to structure your thoughts...

... and make sensible assumptions ...

... then multiply through to get the answer

NB: a real case study would probably involve a more complex market sizing

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This case involves a real life consulting assignment with a manufacturer and distributor of whiskey. This is a typical “conceptual” case; i.e. there will be no numbers, only problem identification and idea generation will be tested.

The client was a first mover in promoting imported whiskey in bars, discos and karaoke clubs, which was a fast growing business in an emerging market about 10 years ago and had experienced tremendous success – an annual growth of over 30%.

The client penetrated the channel with whiskey through aggressive marketing and partnering with top / key outlets in cities, offering sponsorships on events and volume rebates in return for exclusive or preferential sales on-premise. The growth has slowed down in the past few years to about 10% per year and profit margin is also declining.

The key task is to describe and understand the reasons for the recent slow down and fall in profitability. Once that has been completed, the next objective is to explore a range of strategic options for the company to rebuild its growth platform.

Example Full Case: Imported Whiskey in an Emerging Market Introduction you would get from the interviewer

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Introduction

Background

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Example Full Case: Imported Whiskey in an Emerging Market Interview Questions and Good Answers (1/2)

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First Question: What information would you require to help explain the slowing down of growth?

Good Answer:

One needs to understand what has been driving the slow down of the business. You would need to consider the market and competitive environment for whisky. – The tremendous growth the client experienced was driven by the growth of the bar/disco channel, which is peaking as the number of bars

and discos are no longer increasing The category has reached a high share of throat in the channel and is unlikely to grow by increasing penetration

– Competitors saw the opportunity and started to invest following the client’s success Competition has eroded some share from our client

Excellent Answer:

All of the above, but considering also the life cycle and upgrade path for consumers as well as the aging of brand image – The client has been using the same advertising campaign for 5 years and has not been able to come up with new concepts Aging brand image impairs ability to recruit new consumers as well as keeping existing consumers Lack of aspiration for consumers to up-trade to more premium SKUs

– Category life cycle is short as consumers tend to go less to bars/discos as they age and the first batch of recruits are leaving the market at this moment

Second Question: What is driving profitability down?

Good Answer:

One needs to understand the forces in the market that affects the bottom line of luxury consumer goods – Competition has driven prices down (or limited room for price increase) and has limited the margin growth – Competition has driven up costs in trade marketing costs as outlet owners have more bargaining power to choose which manufacturers to

partner with and demand more sponsorships and rebates – Imported goods are subject to currency fluctuations

Excellent Answer: All of the above, but considering also the profit per outlet aspect

– As the business expanded, smaller and weaker outlets (with lower return on investment) began to partner with the client as competitors were also aggressively seeking outlets, driving down the overall return

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Example Full Case: Imported Whiskey in an Emerging Market Interview Questions and Good Answers (2/2)

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Third Question: What are the potential strategic options?

Potential Areas to Explore:

Revitalize brand with new campaign to improve competitiveness

Premiumize the market (given revitalized image) and encourage consumers to up-trade to higher value products (better margin and higher turnover without increasing volume consumption); making price competition irrelevant

Seek opportunities in rural areas and invest strategically to capture less competitive markets

Explore new channels such as in-home or restaurant consumption to catch consumers who leave the bar/disco channel

Innovate to improve on delivery and create competitive advantage

Improvements in outlet selection

Additional Discussion:

Creative / resourceful candidates may discuss one or two:

– Counterfeit eroding sales and hurting brand equity in emerging markets

– The company can invent Innovative ways like new drinking rituals to increase consumption (drink more per occasion)

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For more case examples and information visit our website at: www.occstrategy.com

Any of a multitude of free or commercial consulting books and material may be useful in preparing for the interview

– Wharton Consulting Club

– University of Chicago Booth Management Consulting Group

– Caseinterview.com

– Wetfeet

– Ace the Case

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Many more example cases can be found on our website, and further guides to case interviews can be found online Suggested Further Reading

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http://www.occstrategy.com/






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The recruitment deadlines for the 2015/16 season are:

– Associate Consultant (Entry Level) Vacancy opens: Tuesday 1 September 2015 Application deadline: Sunday 8 November 2015

– International Strategy Workshop, 18 – 22 November, France “4 days in the life of a consultant” Vacancy opens: Tuesday 1 September 2015 Application deadline: Sunday 25 October 2015

– Undergraduate Summer Internship, 8 weeks in July and August Vacancy opens: Thursday 1 October 2015 Application deadline: Sunday 17 January 2016

To apply for a position, please visit our website and submit your details online: http://www.occstrategy.com/careers

Like OC&C London on facebook and keep up to date with the latest events and publications

Follow us on twitter @OCCcareersuk

If you have any other questions, please visit our website, come to an event or email us on: [email protected]

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You can find out more about OC&C and how to apply on our website – applications open in October Recruitment Information

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http://www.occstrategy.com/careers

http://www.facebook.com/pages/OCC-London/160585597288408

mailto:[email protected]

Documents

Ace the Case - Warwick Consulting Societywarwickconsultingsociety.com/wp-content/...the-Case... · Cracking the Case A Rough Guide to Case Interviews ... which isn’t necessarily