deloitte - cracking the case

Copyright © 2004 Deloitte Development LLC. All rights reserved.

Cracking the CaseA Consulting Interview PrimerNovember 29, 2006

Copyright © 2006 Deloitte Development LLC. All rights reserved. 2

• Introductions

• What is a case?

• What are companies looking for in the case interview?

• How do you approach a case?

• Practice

Agenda


• Analyze the situation

• Identify key business issues

• Summarize findings and takeaways

• Outline next steps

What is a case?

A case is a hypothetical business issue or dilemma that requires you to:


• Relevant to a broad spectrum of employment opportunities (marketing, investment banking, consulting)

• A critical component of the recruiting process at many firms

• An opportunity to demonstrate your flexibility, your analytical ability, your experience, your poise… and your creativity

What is a case interview?

Cases are a key part of the interview process and are:


Recent examples of case interview questions

• What are the marketing implications of a partnership between ChevronTexaco and 7-Eleven in which the gas would be supplied by Chevron and the convenience store would be managed by 7-Eleven?

• What strategy should a regional grocery chain pursue to combat/survive against the imminent arrival of Wal-Mart Supercenters in the region?

• What are all the uses you can think of for Hidden Valley Ranch salad dressing?

• How would you forecast revenues for a new drug for breast cancer?

These questions were all asked in case interviews at Kellogg in 2005


What are companies looking for in the case interview?

•Problem definition and solution structuring

•Analytical ability

– Quantitative capabilities

– Dealing with apparent dead-ends

•Ability to . . .

– Synthesize data

– Think creatively

– Defend hypothesis

•Communication skills

– Listening

– Questioning

– Presentation / speaking

•Business acumen

•Confidence / poise

Analytical Skills People Skills


How to crack the case

1. Understand the issue; ask clarifying questions as needed

2. Identify and test the underlying assumptions

3. State your null hypothesis

4. Select an appropriate analytical framework

5. Use the selected framework to identify key business issues

(Keep your eye on the clock!)

6. Summarize key issues and findings

7. Outline your final recommendation and the expected results or impact


Choosing a framework

• Choose a framework that fits the problem; but don’t follow it blindly

• Don’t be afraid to create your own framework – as long as it makes sense

• A framework provides structure to guide your analysis of the case and helps you to identify a good solution

You will probably need a framework to come up with a good answer to a case question


Using a framework to help structure the problem

• Competitive strategy– Porter’s 5 (or 6, or 7) Forces– SWOT Analysis (Strengths, Weakness, Opportunities, Threats)

• Organizational– 7-S (Strategy, Structure, Systems, Style, Staff, Skills, Shared Values)

• Marketing– 4 P’s (Product, Price, Place, Promotion)– 3 C’s (Company, Competitors, Customers)– Growth / Share Matrix

• Profitability– Profit = Revenue – Cost– Revenue = Price x Quantity– Cost = Fixed Costs + Variable Costs


Logical structuring is essential

• Logic should be MECE– Mutually Exclusive, Collectively Exhaustive– Structure of your argument is rigorous, non-overlapping, and complete

• Structure your answer as well as your thinking– Say what you’re going to say, say it, and say what you said– Don’t lose sight of your structure when speaking– Be consistent and convincing in the message you’re trying to get across


Approach: Practical tips

• Take a deep breath– Take a minute or two to structure your approach

– Think before you speak

– Speak what you are thinking

• Ask questions– You have to know the question before you can provide an answer

– Information is generally provided only when it is requested

– Be ready to explain the logic behind your question if challenged

– The ability to ask intelligent questions is a key professional skill


Approach: Practical tips

• Write it down– Structure your notes in line with the selected framework

– Use charts and diagrams to better communicate your ideas

• Show your reasoning– Talk the interviewer through your thought process

– You are being evaluated on the process as much as the answer


A Big Decision for LinkedIn

You are working with the CEO of LinkedIn, a web-based network with over 5 million members, and she faces a big decision that she would like your help thinking through. The company has outpaced its competitors by building the most popular online business network, but has very little revenue to show for it. After a cross-functional brainstorming effort, two ideas for increasing revenue rose to the surface:

1. Keep the existing basic (and free) features of the LinkedIn product, but roll out a series of new and improved services for a monthly fee of $15 – the services would target infrequent users

2. Allow members to contact one another without using an intermediary for a transactional fee of $5

Due to resource constraints, LinkedIn can only pursue one of the two ideas. How should you approach choosing one of the options for increasing revenues? What decision should the CEO make?


LinkedIn: Possible response

1) Understand the issue; ask clarifying questions as needed

• Why aren’t they currently very profitable?

2) Identify and test the underlying assumptions

• There have been no changes to the original services offered by LinkedIn

• Major macroeconomic factors

3) State your null hypothesis • Charge per transaction because the target audience is larger

4) Select an appropriate analytical framework

• Product, Place, Price, Promotion

• Company, Competitors, Customers


LinkedIn: Possible response

5) Use the selected framework to identify key business issues

• Ease of implementation

• Extent to which it addresses the problem

• Size of the benefit

6) Summarize key issues and findings

• You might abandon a certain % of your current market if you charge per transaction

7) Outline next steps and your final recommendation

• Who to contact

• How to implement

• What’s the timeline


Feedback

• Problem definition and solution structuring

• Analytical ability– Quantitative capabilities

– Dealing with apparent dead-ends

• Ability to . . .– Synthesize data

– Think creatively

– Defend hypothesis

• Communication skills – Listening

– Presentation / speaking

• Business Acumen

• Confidence


Starbucks Fresh Ground Coffee

You have just been hired by Starbucks as a Brand Manager in charge of fresh ground coffee beans. Your sales are declining. What would you do to reverse the trend?


Starbucks: Possible response

• Is the decline driven by a general category decline or a share decline for Starbucks Ground Coffee?

• Why is share or category declining?– Substitutes

– Change in consumer habits

• If category is declining, determine strategy to increase category usage

• If share is declining, determine why (explore 4Ps):– Price – Has price changed relative to competition?

– Product – Has the quality of the product changed? Are there any competitive product upgrades/new products?

– Promotion – Have my promotions/advertising changed or decreased? Any new competitive promotions/advertising?

– Placement - Have I lost any distribution? Have competitors gained distribution?


Case interviewing: Do’s

• Listen to your interviewer, take your time and make sure you understand the question

• Ask questions to gather background information

• Develop an approach and a hypothesis and bounce questions off your interviewer to test them out

• Show the interviewer what you’re thinking – talk through your thought process

• Once you have identified some underlying problems, formulate recommendations and be prepared to defend them

• Finally, when closing your answer, define the problem, actions you would take, why you would take them, and the expected results


Case interviewing: Don’ts

• Don’t jump into your answer right away

• Don’t make assumptions without clarifying with the interviewer

• Don’t worry about the right answer, worry about the right approach

• Don’t explicitly or exclusively rely on canned frameworks

• Don’t appear flustered or frustrated


Questions?


Contact information

Renee Martin, On Campus Lead

[email protected]

Rob Carter, Kellogg Recruiter

[email protected]

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