BtE case competition Toolbox

About the Toolbox The Beat the Elite Toolbox is a collection of useful guidelines and frameworks that will assist your case solving process. Although its primary objective is to be used for Beat the Elite, you may also find it useful for other case solving exercises, such as in classes or in job interviews. Much of the content in the Toolbox are meant to serve as a foundation for non-experienced case solvers, thus the Toolbox does not contain a certain right way to solve a case. It does however contain a lot of useful tips and tricks. It is not intended to be a winning formula, but by reading through this collection of frameworks and guidelines the team might be one step closer to be able to Beat the Elite. - Enjoy.

Disclaimer This Toolbox is a collection of useful tips, tools, advices and frameworks that have proven useful for several different case solvers and winners in the past. The Beat the Elite Toolbox is developed by past case team members and winners and therefore all material rights belongs to CBS Case Competition. Beat the Elite Toolbox by CBS Case Competition is licensed under a: Creative Commons Attribution-NonCommercial-NoDerivs 3.0 Unported License. For further information, please visit: www.casecompetition.com/bte

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BtE case competition Toolbox

Introduction Problem solving:

This section describes how to structure the problem solving part of your solution.

Presentation: How to set up your presentation and ensure the output looks nice, neat and professional.

Practicalities: This section describes some of the practical things that can be done before the case launch, as well as some insiders tips from previous participants.

Industry overview: This section highlights the key traits for a wide range of industries. It is intended to enlighten people with limited knowledge of business on what areas to focus on during the case solving

Additional reading: External sources and readings.

Content Problem solving pp 4-8 Presentation pp 9-24 Practicalities pp 25-27 Industry overview pp 28-36 Additional reading pp 37

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Problem Solving

Introduction Structuring of the problem solving process is very important. The teams are only given 24 hours to solve a complex problem and hence a systematic approach will help prioritize and structure the task at hand. This section is about exactly how to do that. Hypothesis-driven problem solving: This section describes one the most time efficient ways to attack a problem. MECE approach: The MECE approach is widely used within the management consulting industry and for a good reason; This framework ensures that the whole problem solution space is tested. Issue tree: Issue trees are often combined with the MECE approach in order to prioritize and break down the problem. Sanity check: This section describes the importance of doing a sanity check.

Content Hypothesis-driven problem solving MECE approach Issue tree Sanity check

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Hypothesis-driven problem solving

Description Hypothesis-driven problem solving is, as the name states, all about forming a hypothesis and then testing whether one is right or wrong about the initial hypothesis. As an example look at the figure on the right. This example describes the hypothesis that changing the quality of the product will lead to an increase in the price and thus the profitability of the product sold. First the initial hypothesis is stated, this is then followed by an analysis which can lead to either confirming or refuting the initial hypothesis. After this, a series of new hypothesis can then be formed, here are two examples: Do not look for profit by changing quality since the analysis shows that neither in- or decreasing quality will change profitability. Or check if reduction of quality instead will lead to increased profitability.

Looking at price sensitivity, consumer demand, capital investments needed and uptake rates,

After analysis we refute the hypothesis. Increasing quality will not increase profit pr. item.

Increasing quality of the product by 5-10% will lead to a 2% increase in profit pr. item.

Hypothesis

Refute hypothesis

Confirm hypothesis

Analysis conclusion

Data

Analysis

or

No additional profit can be found by changing quality.

Reducing quality by 20% will lead to 5% increase in volume and 10% increase in price pr. item.

New hypothesis /

final conclusion

New hypothesis /

final conclusion

Stating initial hypothesis

Confirm or refute Research, analysis and conclusion

Formation of next step

hypothesis

5

or

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Total possible solution space

MECE

Description MECE stands for Mutually Exclusive and Collectively Exhaustive and is a tool commonly used within the management consulting industry. The framework makes it easier to break complex problems down into smaller, more simple problems. If the breakdown is MECE the team ensures that all the sub-issues collectively exhaust the total solution space (no grey area is left uncovered) and that the sub-issues are mutually exclusive (no sub-issues are overlapping) as seen on the right. By structuring a problem this way the team ensures that they do not miss any possible solution options. It will also be possible to distribute the work among the team members without duplication of any work, thus the limited time will be used more efficiently.

Total possible solution space

Sub-issue #1

Sub-issue #2

Sub-issue #4

Sub-issue #3

A non-MECE issue tree

Sub-issue #1

Sub-issue #2

Sub-issue #4

Sub-issue #3

A MECE issue tree

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Form solution hypothesis

Overall problem

MECE

Prot

Cost

Revenue

Volume

Price / item

Variable costs

Fixed cost

Brand percep;on

Quality

New markets

New segments

Export to China?

Exis;ng customers

Increase customer base

Other

Export to Brazil?

Updated exis;ng products Expand product porIolio

A MECE issue tree

Description The issue tree deconstructs an issue into its sub-issues and the sub-issues into its sub-issues and so forth. A complete issue tree makes identification of possible solutions easier and guides the problem solving process. In this example an issue tree is constructed around a profit problem in a company, so in order to know how to fix the profit problem, a MECE issue tree can be constructed. The overall issue is profit. On the next level, profit is deconstructed into revenue and cost. Please note that revenue and cost are the only drivers of profit and they are not overlapping - henceforth the issue tree is MECE at this level. Looking at revenue this is deconstructed into price / item and volume, again this is two MECE elements of revenue. This issue tree is MECE but all branches are not fully developed. Note: No issue tree is the only right way to structure a problem but many are wrong, which is why making it MECE must be top priority.

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Sanity check

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Description Early on in the process it is important to do a sanity check of your solution. As seen in the figure, the sanity check is supposed to make sure that the proposed solution is both creative, has sound analysis to back it up, is feasible and has impact. If all these four elements are in place the team could have a winning solution. The sanity check is also a good opportunity for the team to stop working, take a step back and ask the question: Is this solution something that the company might actually consider? Again, there is not one way to get it right, but many ways to get it wrong. An example of a creative, but non-feasible solution, could be to open a store on Mars. An example of a solution that have all elements but creativity, could be to optimize all current operations by 2%. Neither solution are winning solutions due to their complete lack of one of the four elements. So make sure that at least these four are somewhat present.

Feasibility

Impact

Creativity

Analysis Winning solution

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Presentation

Description This section entails everything you need in order to convey your solution in a compelling and convincing way. There are two major parts of a good storyline: 1. Structure of content telling the right things. 2. Structure of argumentation telling it the right

way. If you have these two elements you have a good storyline. This section first describes and exemplifies a logical way to structure the content of your presentation. That is which analysis and finding to present in which order. Then, this section describes the two most used argumentation structures, the inductive and the deductive which is then exemplified. Lastly, in the final part of this section everything is put together in an example of a good case solution storyline.

Content Storyline pp 10-15

Structure of content Structure of argumentation Inductive vs. Deductive

reasoning Putting it all together

The executive slide pp 16 Powerpoint dos

and donts pp 17-24

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How to structure your content in a logical way

Setting the stage

Identify problem

Solution

Arg. 1 Arg. 2

Impact

Description An often used structure of the content in the presentation is based upon what the reader expects to come next. On the right is an example of how to structure the different parts of your solution. This flow ensures that the structure of the solution is easy to follow for the reader/listener. These four parts are based upon what you are telling the reader, as seen on the right. First the overall situation of the company is presented. Then, the implication (problem) of that situation is identified. In the third part of the story, the solution to the problem is presented. In the solution part it is also vital to present the arguments as to why the team has settled on that particular solution. Lastly, the impact of the solution should be presented.

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Logic of structure - we are telling you

1: Where are we now?

2: Why is this a problem and what is the problem?

3: What is our solution to the problem?

4: What is the impact of our solution?

The four major elements

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How to structure a strong logical argument throughout your presentation

Inductive method: 1. Tell your recommendation/solution up

front in the presentation.

2. Then, in the following section tell why you recommend what you do.

Deductive method: 1. First, show all your analysis and

conclusions.

2. Then, in the end serve your final recommendation for the company based on the results of your analysis. Note:

While the deductive method can be really powerful if used correctly, it is recommended that the team uses the inductive storylining. The reason being that if using the deductive reasoning, the team must be absolutely sure that the reader will agree on the results and the logic of the argumentation or else the complete argument for the solution could fall apart. The inductive also has the advantage that it follows the logic of: First tell them what your going to tell them, tell them and then tell them what you told them.

Description Having secured that the structure of the content in the presentation is good, the team must also make sure that the storyline follows a strong logical argument. That is, how to structure the four elements. This means that it should be easy for the reader to follow the logical flow of why the next slide looks like it does. E.g. setting the stage: the companies revenue is stalling due to maturity in market the next slide indentifies the problem of the situation. Broadly speaking there are two possibilities for how to build the logical argumentation of a good storyline. A good story in a solution almost always follows either the inductive or the deductive method.

Solution

Argument

Argument

Solution

Flow of argum

ent Flow

of argument

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Example of the inductive storyline

The company should expand their business to China By first targeting the coastal region And pack items in smaller packages Resulting in a net turnover growth of USD 1bn in 2015

Reasons for going to China 1. Because the market potential is huge. 2. The growth is strong. 3. Current markets are mature. 4. There are certain risks but they are limited. 5. We will be able to boost revenue by USD

1bn by moving into China. 6. Which is more than other considered

possibilities.

Why to target the coastal region 1. Large share of population. 2. Fastest growing region. 3. Highest share of net wealth people.

Reasons to consider product modifications 1. Cultural differences make Chinese

consumers seek different value propositions.

2. Small is beautiful in China. 3. Current consumer trends support smaller.

Financial analysis of revenue growth by 2015

Wrap up

We recommend that

because (supportive analysis and conclusions)

Note: This box is basically what to tell on the executive slide

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Example of the deductive storyline

The company should expand their business to China By first targeting the coastal region While consider product modifications Resulting in a net turnover growth of USD 1bn in 2015

1. The market potentials 2. The growth rates 3. Current markets potential 4. Risks involved 5. Revenue possibilities in different markets China comes up as the most

lucrative market

1. Distribution of population and their net wealth 2. Growth across Chinese regions The coastal area is where the

Chinese expansion should start

1. Cultural differences Value propositions needed Spending patterns Consumer trends

Packaging in smaller bundles is needed

Financial analysis of revenue growth by 2015

Wrap up

leads us to recommend that

Looking at (analysis and conclusions)

Note: Again, this box is similar to the content of the executive slide.

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Another example of the inductive storyline

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Description One can see how this structure is closely linked to the MECE framework. In fact a good logical structure will almost always follow from a correctly constructed MECE tree. In the figure on the right it is shown how one argument builds upon the underlying arguments. First the solution and its

impact is told. Then on level 2 the

possible markets are presented.

On level 3 the different analysis are presented. The Chinese outperformed taking market size, risk analysis, impact and ease of implementation into account.

Finally, on level 4 the roll out plan is justified.

Expand to china realizing a USD 1bn

revenue growth

Chinese market

Market size & growht Risk analysis Roll out plan

Region feasibility

Product portfolio & channels

Consumer behavior

Financial impact

Current markets

Market size & growth

Other markets

Market size & growth

Risk analysis

Which new market should the company expand to?

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Putting it all together: Telling a story during the progression of the presentation

Key focus areas: Logic of progression through the presentation should be easy to follow. By reading only the headers, the reader should be able to understand case solution. See the example below.

Executive slide We recommend the company to expand their business to China and gain USD 1bn in

revenue because home markets are under pressure.

Home market is weak We see weak growth Increased competition Weak spending due to

financial crisis

So other revenue sources are needed

1. Brazil 2. Russia 3. India 4. China China is the best option

China is the most promising market

High growth Large market Weak customer loyalty Resistance towards

western brands

They can be won by adapting product

Given consumer behaviour, best way to enter is: 1. Enter 2. Adapt 3. Expand

And will make further expansion possible.

Start in major cities Expand to coastal region 500 stores by 2015

So while still taking risks into account

Risk 1 Risk 2 Risk 3 How to mitigate risks

Although Chinese customers are different Resistance towards

western brands due to 1. Reason 1 2. Reason 2

Our solution will grow topline by USD 1bn

Wrap up Tell them what you told

them. USD 1 bn

2020

Note: This presentation is not a solution for how you need to structure (or design) your presentation, but only meant as an illustrative example.

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The executive slide

[Setting the stage] What is the current situation for the firm? [Identify the problems(s) or opportunity] [Propose solution] Argument 1 Argument 2 [Discuss impact/implications] Financial and strategic impact

Executive slide

Setting the stage

Executive slide

Identify problem

Solution

Arg. 1 Arg. 2

Impact

Description It is recommended to put an executive slide in the beginning of your presentation, since this supports the inductive reasoning. The executive slide should Make the reader able to understand your solution and why you have reached your conclusions. Be the introductory slide for the presentation presented to the judges, should the team reach the finals. Tell the same story as all the headlines of the presentation.

Example A Example B

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Powerpoint dos & donts

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Introduction This following sub-section is a collection of dos and donts regarding the visual setup of your slides. Since you only have 10 slides, it is vital that nothing is lost in translation, meaning do not succumb to the usual Powerpoint mistakes. The following examples are not an exhaustive list of all powerpoint mistakes but a collection of some of the most common mistakes that can easily be avoided. By making sure that your slides look more like the do-examples and less like the dont-examples you increase the possibility for the reader to understand the slides as it was intentionally meant to be understood. On the right you will find a list of the following slides.

Overview

Notation on graphs pp 18 Key takeaway in header pp 19 One message pr. slide pp 20 Less is more in graphs pp 21 Less is more in effects pp 22 Supporting the message pp 23 Illustrate instead of excessive

use of bullets pp 24

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Remember notations on your graphs

Do Dont

52.6 41 -20 2 -2 -10

-100

0

100

200

300

400

500

600

2007 2008 2009 2010 2011 2012

52.6 41 -20 2 -2 -10

-100

0

100

200

300

400

500

600

2007 2008 2009 2010 2011 2012

M DKK

r

Revenue EBITDA

Note: Only include data labels if they are needed to prove your point. Also remember to include your source in the bottom of the slide. This adds credibility to your presentation.

Source: Annual report 2012

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Make sure to put the key takeaway from your slides in the header

Do Dont Recent financial development

526

410

123

270

180 170

52.6 41 -20 2 -2 -10

-100

0

100

200

300

400

500

600

2007 2008 2009 2010 2011 2012

M DKK

r

Revenue EBITDA

Case Company has faced stagnating revenue growth and swindling margins since financial crisis in 2009

-100

0

100

200

300

400

500

600

2007 2008 2009 2010 2011 2012

M DKK

r

Revenue EBITDA

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Tell only one key message pr slide

Do Dont CaseCompany has not recovered from financial crisis and current plan will not meet 2015 turnover target

Note: Due to the limitation of 10 slides pr solution it may prove neccesary to cram more information into every slide, but it is strongly recommended to only deliver one key message per slide

CaseCompany has important revenue drivers, but it has resulted in poor post-crisis growth and cost savings initiatives from previous strategy plan will not be able to satisfy shareholder expectations of USD 1 bn in turnover by 2015

Revenue

Driver1 Driver2

Cost Driver 1 Driver 2 Driver 3

Prot

Cost saving ini;a;ves from 2015-Plan Reduce overhead by 10% Divest subsidiary1 Procurement Savings Plan

Tager: 50M DKK Outsource of produc;on to India

Recent performance Turnover forecast

2015 Target

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Less is more when it comes to data presentation

Do Dont

Note: Design your graph so the reader quickly and easely can read it

Revenue split into carrier type and region

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Less is more when it comes to colours and effects

Do Dont

Note: and it looks unprofessional

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Make sure only things that back up the message of the slide is included

Do Dont

Note: Images should only be included if they help to make a point clearer. Here this is hardly the case, even on the left-hand slide the value-added from the images is limited.

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Design for social change requires three key initiatives

Structure new business models to diversify withholding and manage assets

Gravitate to situation-oriented business models

Find new eco-friendly consumer-oriented byproducts

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A figure is worth a thousand bullets

Do Dont

Note: Excessive use of bullets dilutes their purpose. A bullet point is a short concise point dont put 20 short concise points on one slide. Not only is it tedious to read, it also hide the message of the slide.

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Practicalities

Description This section describes some the most important practicalities that lies outside the actual problem solving process and case solution. That being said, the practicalities included and described in this section has a high probability of making the 24 hours of case solving easier. If ignored, there is a high probability of making the case solving hours more difficult. Time management: Due to the time pressure, a good plan will ensure that the team makes the most of the available time. Quotes from the insiders: This section includes some insiders tips for what things the team would be like to have under control before the actual case launch.

Content: Time management pp 26 Quotes from the

insiders pp 27

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Develop solu;on

19:00

Ini;al data research Retest hypethesis Brain storm

Struc-turing

10:00 11:00 12:00 13:00 14:00 15:00 16:00 17:00 18:00

2hr checkup. Are we aligned?

Develop inital hypothesis

Draw up a time plan before the case launch

Develop solu;on

Buer/rehearse

20:00 21:00 22:00 23:00 24:00 01:00 02:00 08:00 09:00

2hr checkup 2hr checkup Gather slides Final version

Sleep

The time plan does not have to be as specific as this one, but a rough time plan will certainly prove helpful as it will help the team to not spend too much time on unnecessary tasks. E.g. analysis of market irrelevant for the case solution, spending too much time on date search etc. Also the team should note that the time plan will almost certainly not be held, as unavoidable events will happen during the case solving. However, making a time plan will keep reminding the team that time is precious and spending it unwisely is not recommended. Lastly, this time plan is not the golden rule as to how to allocate the 24 hours but only an example. The golden rule that does persist is, the more specific the time plan, the more it will help throughout the process.

Description Example

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Quotes from the insiders

My five cents on practicalities would definitely be to assign team roles and know each others relative strengths and weaknesses. Having the discussion before the launch as well as a time manager saved us time.

Remember to buy snacks, snacks, snacks & more snacks.

Set up the master slide before the case launches. We wasted at least 3 hrs. setting up and agreeing on the layout.

Practice makes perfect. It was so evident that the more training cases we did, the better we got.

Know your data sources. Having the best data available is a competitive advantage.

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It is very wise to save some time in the end for iteration, going through every slide asking the questions: What do we want to tell with this slide and will the reader understand it.

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Industry Overview

Description This section describes some the typical industries that cases evolve around. The given industry description serves as a guideline of the key aspects to consider within a particular industry. Please note, the industry list is not exhaustive, and there may therefore be additional industries that you may need to do research on yourself. Additionationally, please note that the industry snap shots are not a recipe for success, but rather a guideline and help for those who have limited knowledge about the industry (for instance non-business students) Each industry snapshot gives entails a short description of key trends, competitive landscape, customers, channels, and profit summary.

Content: Transportation pp 26 Consumer Packaged

Goods (CPG) pp 27 Entertainment Finance Manufacturing Media Pharmaceuticals Technology

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Transportation companies provide transport services for passengers and/or for freight, and can be done either via rail, road, air, or water

Transportation Industry

Description

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Increase of cost competition as more transportation service types become more freely available

Can be seasonal for certain types of transportation services

Private individuals Corporations/small businesses Travel web sites/resellers

Fare revenues; administrative & handling fees; add-on service sales

Variable costs: fuel; food and beverage; staff/hourly employees Fixed costs: fleet leases; gate/port leases; IT/admin costs; salaried employees

Key trends

Customers

Revenue drivers

Cost drivers

CPG companies provide consumers with a range of household products and the like, such as soaps, pet supplies, snack foods etc.

Consumer Packaged Goods (CPG)

Description

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Consumer lifestyle, e.g. aging population, social networks, online ads, go green, etc Product mix and brand management are critical to CPG companies

Individual Customers Business Customers

Volume of goods sold; price premium on branded goods; new product introductions

Branding; sales; marketing; COGS (commodity costs raw & packaging material)

Key trends

Customers

Revenue drivers

Cost drivers

Broad range of financial products (deposit services, credit cards, loans, etc.) are sold by banks whose main function is to collect money from those who have savings and loan money to those who need it.

Finance (Consumer Banking)

Description

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Financial crisis threatened solvency of industry due to illiquid and un-valuable assets Consolidated, mature industry with growth through acquisitions Demographic shift creating a large market for retirement products

Individual consumers, especially high net worth consumers Small/medium businesses without sufficient size for larger investment banking financing

services

Difference between the banks borrowing cost and the interest rates charged to borrowers; administrative fees for services

Administration; salaries; writing off bad debt, bank branch offices

Key trends

Customers

Revenue drivers

Cost drivers

Manufacturing sector includes companies that are in the business of mechanical, physical, or chemical transformation of materials/substances/components into new products

Subsectors of manufacturing include: textile, paper, chemical, computer/electronics, transportation equipment, machinery

Manufacturing

Description

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Manufacturing is highly cyclical in most sectors Higher cost structure (labour in many cases) lead companies to outsource manufacturing

to lower-cost regions of the world

End-consumer; OEM (original equipment manufacturer); B2B (Business-to-business)

Diversity of customers; volume; emerging markets; adjacent industries; new technologies/products

Potential outsourcing quality costs; supply chain management (inventory turns); labor; raw material; channel management; marketing; capital investment in equipment

Key trends

Customers

Revenue drivers

Cost drivers

The media sector includes print, audio ,and video content generation Primarily an advertising-supported industry, the traditional media space faces

unprecedented challenges as online media continues to disrupt traditional business models Media

Description

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The rapidly advancing speed of the internet and wireless devices change the consumption pattern of media

The proliferation of free content has harmed content generators but created opportunities for new channels.

Individual end-consumers Business users Advertisers

Advertising; subscriptions; individual sales

Variable costs: salaries; technological equipment Fixed costs: Studios/press offices; overhead; marketing; advertising

Key trends

Customers

Revenue drivers

Cost drivers

Pharmaceutical companies produce original patent-protected (for a certain period of time) drugs for human and animal diseases

Generic drug producers produce copy-cat drugs (with the same medical result) at a lower development cost when the originator drugs patent expires

Pharmaceuticals

Description

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Price competition from generic drug manufacturers Increasing pressure from health insurance companies and hospital chains to reduce prices R&D challenge of finding high revenue drugs

Doctors who prescribe these medicines Insurance companies that pay for them Patients/consumers who need these drugs/medicines

Patent premium; buy-in from doctors that will prescribe; speed to market; niche products Variable costs: sales; marketing; raw material, salaries Fixed costs: R&D; equipment; machines

Key trends

Customers

Revenue drivers

Cost drivers

The entertainment industry provides different services and products for customers' leisure time

Entertainment

Description

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Increasing competition from stay-at-home or other free alternatives of entertainment compared to traditional entertainment types

Individual customers Business arrangements

Service/product/ticket sales, subscriptions, gadgets sales; add-on sales Variable costs: raw materials; salaries Fixed costs: equipment, venue areas; advertising

Key trends

Customers

Revenue drivers

Cost drivers

The technology industry broadly consists of the systems (PCs, servers), semiconductors, communications equipmentl software, internet and IT services subsectors. Technology Description

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Increasing M&A activity: aggregation offering customers a one stop shop proposition Co-opetition: Leading vendors co-exist as competitors and collaborators. Cloud Computing: Offering IT as outsourced utility has implications across subsectors Individual customers Enterprise, SMB (small/medium businesses), Retail channel customers Subscriptions; licenses; maintenance; renewals, revenue per click Variable costs: salaries, advertising Fixed costs: R&D; equipment: gross margins, R&D

Key trends

Customers

Revenue drivers

Cost drivers

Additional reading

Online Here we have listed external sources and additional reading that is also useful for the case solving team. Choosing the right kind of chart:

http://extremepresentation.typepad.com/files/choosing-a-good-chart-09.pdf

Previous cases:

http://www.casecompetition.com/case_solving/previous_cases

www.caseinterview.com www.bcgperspectives.com

Data sources: http://www.eiu.com/ http://research.thomsonib.com/

Offline How to structure your argument:

Barbera Minto The pyramid principle

Presentation design advice: Gary Reynolds Presentation Zen Nancy Duarte - Slideology

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