Cracking the Case. A Rough Guide to Case Interviews

Transcription

1 Cracking the Case A Rough Guide to Case Interviews

2 We want applicants to come into case interviews knowing what to expect this makes for a much better debate and exchange of ideas Purpose of This Document 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! 21

3 Agenda Introduction to OC&C How to Approach Case Studies Frameworks and An Example Case How to Apply to OC&C 32

4 OC&C is a leading strategy consultancy, founded in London 28 years ago London Paris Rotterdam Hamburg Warsaw Düsseldorf Istanbul Background 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 Boston Belo Horizonte São Paulo Mumbai New Delhi Hong Kong Shanghai Our client roster includes some of the largest corporations and most innovative challengers in the world OC&C s Global Reach 42 Presentation1

5 We work with senior management teams on a range of strategically critical issues Strategy Business Transformation Transactions / M&A Top UK and international companies Senior management Typically 4 8 weeks Long term client relationships The biggest UK and international companies Typically 8 16 weeks Corporate clients and private equity Big and small deals across sectors Typically 3 6 weeks Answering the big questions: How to grow? How to develop? How to compete? Making companies lean and fit: Realising Change Reducing Complexity Building new capabilities Advising on: Whether to buy Potential for growth Post acquisition strategy 54

6 Why OC&C Strategy and Sector Specialists Entrepreneurial Culture 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 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 Rapid Progress 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 Market-leading Rewards 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 64 5

7 Agenda Introduction to OC&C How to Approach Case Studies Frameworks and An Example Case How to Apply to OC&C 76

8 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 Benefits of case interviews for us... 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... 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 85 7

9 There are four basic steps you should go through when tackling any case Listen and Clarify Structure Analyse Conclude Make sure you understand the question: Think about how you are going to solve the problem before diving in: Gather the information you need to solve the case: Wrap-up your findings into clear recommendations: Listen carefully Take notes if it helps you Ask clarifying questions as needed Structure problem Identify key issues and prioritise Formulate an initial hypothesis / hypotheses Ask questions and collect information Develop, test and refine hypothesis Hone in on the solution Summarise your findings and draw out key facts Don t just repeat the answers to your analysis ask yourself so what? Take time to evaluate the information given Articulate approach and hypothesis Verbalise your thought process Make clear recommendations Add next steps 96 8

10 However, cracking a case isn t about following a process: you will need intelligence, creativity, common sense... and some elementary business knowledge 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 You can see worked examples of some of these later in this document, or read about them online 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! 109

11 Finally, some top tips from our interviewers... Do 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 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

12 ... and some words of advice from recent successful candidates 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 12 11

13 Agenda Introduction to OC&C How to Approach Case Studies Frameworks and An Example Case How to Apply to OC&C 13 12

14 Example Framework #1 How to apply profit = revenue - cost... to Swedish furniture 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 and to translate the facts provided (in italics) into their implications for profit Sales volumes have fallen The Krona has strengthened... hurting our export competitiveness Profit has fallen Revenues have been falling No evidence of change in prices Competitors have discounted... causing market share loss Costs have been rising Fixed costs don t appear to have moved New logging restrictions... have increased wood prices Variable costs have risen Trade union action... has increased wages 14 13

15 Example Framework #2 How to apply market sizing... to golf balls 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 Determine the estimated number of customers in your market # of Customers Targeted Golf is played by 10% of the UK population 60m population x 10% = 6m players Think about their usage / purchase behaviour, and whether there are any distinct segments of customers # Usage Occasions per Year # Purchases per Usage Occasion 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 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 Estimate the price the customer might may per unit Price per Unit An average golf ball costs 50p (we will assume here that regular and infrequent players buy the same balls NB: a real case study would probably involve a more complex market sizing Total Sales in Market (28m + 48m) x 50p = 38m per year 15 14

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

17 Example Full Case: Imported Whiskey in an Emerging Market Interview Questions and Good Answers (1/2) First Question: Good Answer: Excellent Answer: What information would you require to help explain the slowing down of growth? 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 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: Good Answer: Excellent Answer: What is driving profitability down? 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 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

18 Example Full Case: Imported Whiskey in an Emerging Market Interview Questions and Good Answers (2/2) Third Question: Potential Areas to Explore: Additional Discussion: What are the potential strategic options? 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 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)

19 Many more example cases can be found on our website, and further guides to case interviews can be found online Suggested Further Reading For more case examples and information visit our website at: 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

20 Agenda Introduction to OC&C How to Approach Case Studies Frameworks and An Example Case How to Apply to OC&C 20 19

21 You can find out more about OC&C and how to apply on our website applications open in October Recruitment Information 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, 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: Like OC&C London on facebook and keep up to date with the latest events and publications Follow us on If you have any other questions, please visit our website, come to an event or us on: recruitment@occstrategy.com