Boston College - SAI Structuring Business Problems College - SAI Structuring Business Problems Rikin...

Boston College - SAIStructuring Business Problems

Rikin [email protected]

2

Today’s workplan

CreatingSpecific

Structures

“Choosing to know”

Visuals /Brain pops

Maximum ValueModel

Hypothesis-driven

AnticipatingData

Coming up withmetrics/proxies

Visualizing data

Building“Nose for Value”

Presenting in astructured way

Structuring drills

Homeworkinstructions

3

We will use this MBACASE Path as aguide to our skills.

1

2 3

45

6

7

4

We’ll focus on our starts

Qualitative

StartStart

End

Warmth &Client Ready

Warm-up

Insight!

Chart/Table

Chart/Table

DataDumpDataDump EstimateEstimate

EquationsEquations Solvefor XSolvefor X

Quantitative Depth &Analytical

Logic &Breadth

Integration &Creativity

Data

So what?

5

Let’s practice in the Start zone, wherewe demonstrate how we approach problems

Qualitative

StartStart

End

Warmth &Client Ready

Warm-up

So what?

Insight!

Chart/Table

Chart/Table

DataDumpDataDump EstimateEstimate

EquationsEquations Solvefor XSolvefor X

Quantitative Depth &Analytical

Logic &Breadth

Integration &Creativity

Data

6

1. Be as specific as possible

2. Drive towards an answer as early aspossible

3. Show off your ability to anticipatedata

4. Present in a structured and confidentmanner

5. Be flexible - ready to explain andadapt

Structuring best practices

7

Choose to know!

Let’s get 3 experts and a topic…

8

Using visuals / brain pops

TimeTime FinancialGoals

FinancialGoals CompetitorsCompetitors Product

QualityProductQuality DistributionDistribution

Our client wants to open a chocolate store.

Short TermShort Term

Mid TermMid Term

Long TermLong Term

Break EvenBreak Even

ROIROI

Profit MarginProfit Margin

BoutiquesBoutiques

Gift ShopsGift Shops

Ice CreamIce Cream

OrganicOrganic

CocoaCocoa

ConsistencyConsistency

CentralCentral

RegionalRegional

Does ourclient have a

deadline ?

Does ourclient have a

deadline ?

What is ourROI goal?

What is ourROI goal?

Do you havedata on

competitors?

Do you havedata on

competitors?

What are theproduct

standards?

What are theproduct

standards?

Will wemake on siteor distribute

it?

Will wemake on siteor distribute

it?

9

What’s your objectivewith every case?

Maximize the Valueof the Company

10

Develop an integrated mental map –Maximum Value Model (MVM™)

Strategy

Operations

OrganizationFinance

People

Systems

Processes

Measure

.

CA$H

D/E

SP E C I A L

T

Zone 1

Zone 2

Zone 3Zone 4

Zone 5

R

C

VolumeMixPrice

FixedVariable

Customer

11

Waterfall – each zone adds value

Zone 1

Zone 2

Zone 3Zone 4

12

Strategy – increase, change, shrink

Strategy

Zone 1

Zone 2

Zone 3Zone 4

13

Operations – revenue and cost

Strategy

OperationsZone 1

Zone 2

Zone 3Zone 4

R

C

VolumeMixPrice

FixedVariable

Customer

14

Organization – people, systems,processes and measurement

Strategy

Operations

Organization

People

Systems

Processes

Measure

.

Zone 1

Zone 2

Zone 3Zone 4

R

C

VolumeMixPrice

FixedVariable

Customer

15

Finance – cash, debt, equity

Strategy

Operations

OrganizationFinance

People

Systems

Processes

Measure

.

CA$H

D/E

Zone 1

Zone 2

Zone 3Zone 4

R

C

VolumeMixPrice

FixedVariable

Customer

16

External Forces

SP E C I A L

TZone 5

Suppliers

Public

Economy

Competitors Industry

Technology

Legal

Auditing

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Maximum Value Model (MVM™)

Strategy

Operations

OrganizationFinance

R

C

VolumeMixPrice

FixedVariable

People

Systems

Processes

Measure

.

CA$H

D/E

SP E C I A L

T

Zone 1

Zone 2

Zone 3Zone 4

Zone 5

Customer

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“House” your ideas in a way that is easy tounderstand

Main Idea

Group A

•Why?

•Data?

•Questions?

Group B Group C Group D

Facts

Data

Plan

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Profit trees remove overlaps but may not bebest for all cases

Facts

Data

Plan

TT

R

C

P

V

VC

FC

issue

driver

Situation ASituation A

CriteriaCriteria

CriteriaCriteria

CriteriaCriteria

• Dream data

• Dream data

• Dream data

• Dream data

• Dream data

• Dream data20

Hypothesis-driven approach

Situation BSituation B

CriteriaCriteria

CriteriaCriteria

CriteriaCriteria

• Dream data

• Dream data

• Dream data

• Dream data

• Dream data

• Dream data

Situation CSituation C

CriteriaCriteria

CriteriaCriteria

CriteriaCriteria

• Dream data

• Dream data

• Dream data

• Dream data

• Dream data

• Dream data

What wouldwe expect to

see if thissituation did

exist?



exist?

What datawould allow usto test if these

criteria doexist?


criteria doexist?

What formatwill the final

answer be in?


answer be in?

We should open a chocolate store in NYC if…situations A, B, and C exist

We should open a chocolate store in NYC if…situations A, B, and C exist

Pick a business issue from the world around you

Block 1Block 1

Break 1Break 1

Break 2Break 2

Break 3Break 3

• Dream data• Dream data• Dream data


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Think of your own cases!

Block 2Block 2

Break 1Break 1

Break 2Break 2



Break 3Break 3

Block 3Block 3

Break 2Break 2



Break 3Break 3

Break 1Break 1

Situation ASituation A

CriteriaCriteria

CriteriaCriteria

CriteriaCriteria

• Dream data

• Dream data

• Dream data

• Dream data

• Dream data

• Dream data22

Hypothesis-driven approach

Situation BSituation B

CriteriaCriteria

CriteriaCriteria

CriteriaCriteria

• Dream data

• Dream data

• Dream data

• Dream data

• Dream data

• Dream data

Situation CSituation C

CriteriaCriteria

CriteriaCriteria

CriteriaCriteria

• Dream data

• Dream data

• Dream data

• Dream data

• Dream data

• Dream data



exist?



exist?


criteria doexist?


criteria doexist?


answer be in?


answer be in?

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Practice thinking of specific data that youwould love to see

Secondary sourcesSecondary sources

Metrics / ProxiesMetrics / Proxies

Visualizing chartsand describing aloud

Visualizing chartsand describing aloud

Primary SourcesPrimary Sources

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1. Present how you’re going to present

2. Share the breadth of your thinkingby outlining your buckets before youdive deep

3. Be as specific as possible with data

4. Confidently check in with the otherperson on your approach

5. Be flexible - ready to explain andadapt

Presenting best practices

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Structuring Drills – 15 min (1 – Merger, 5 – Profit)

A) Hear case prompt and ask anyclarifying questions (1m)

B) Create initial structure on page(3m max)

C) Present first time out loud,while adding ideas to page asthey arise (3m max)

1) Receive feedback andincorporate onto page(2m max)

D) Present second time,tightening length (3m max)


E) Present third time, continuing totighten (3m max)

A) Hear case prompt and ask anyclarifying questions (1m)

B) Create initial structure on page(3m max)

C) Present first time out loud,while adding ideas to page asthey arise (3m max)


D) Present second time,tightening length (3m max)


E) Present third time, continuing totighten (3m max)

• “You were not specifichere”

• “You did not prioritize –too many areas of focus”

• “You focused on thewrong areas – nose forvalue”

• “It was difficult to followyour structure – yourambled or didn’t provideyour buckets up top”

• “You didn’t mention anydata – sounded toosoft/general”

• “You were not specifichere”

• “You did not prioritize –too many areas of focus”

• “You focused on thewrong areas – nose forvalue”

• “It was difficult to followyour structure – yourambled or didn’t provideyour buckets up top”

• “You didn’t mention anydata – sounded toosoft/general”

Sample FeedbackSample Feedback

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Homework – Give & Receive 6 Starts (10-15 mineach)

A) Hear case prompt and askany clarifying questions

B) Take X minutes to createinitial structure

C) Present first time for Xminutes (while adding ideasto page as they arise)1) Receive feedback and

incorporate onto page

D) Present second time,while tightening length1) Receive feedback and








• Case Starts 1 and 2• 3m to create structure• 3m for first present• Tighten each time


• Case Starts 5 and 6• 60-90s to create• 2m for first present• Tighten each time

• Case Start 7 – FILMED!• 90s to create• 2m to present• Present only once





Get Faster Each TimeGet Faster Each Time

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Let’s practice our integrated thinking

Merge, Acquire, JV

Growth Strategy

New Product/ Bus

New Market (Geo)

Strategy

Maximize Profit

Change Price

New Processes

Restructure Team

Ops & Org

Competitor Attack

Market Shift

External Forces

Let’s look for commonpatterns

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First, move through your mental map

Strategy

Operations

OrganizationFinance

People

Systems

Processes

Measure

.

CA$H

D/E

SP E C I A L

T

Zone 1

Zone 2

Zone 3Zone 4

Zone 5

3

2

41 R

C

VolumeMixPrice

FixedVariable

Customer

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Main Idea

Group A

•Why?

•Data?

•Questions?

Group B Group C Group D

Facts

Data

Plan

Then, lay out your plan

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1 - Merge, Acquire, Joint VentureBarcelona based airline wants to acquire a smaller,Spanish airline. Should they do it?

Strategy

Operations

OrganizationFinance

People

Systems

Processes

Measure

.

CA$H

D/E

SP E C I A L

T

Zone 1

Zone 2

Zone 3Zone 4

Zone 5

3

2 41 R

C

VolumeMixPrice

FixedVariable

Customer

1

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Acquire new airline

Strategy

•Growthplans?

•Customerfit – needs?

Ind/Comp Rev/CostSynergies

Practical

Facts

Data

Plan

•What arethe trends

•Compet.Strengths?

•Will wehaveadvant?

•Will theycomplementor hurt?•Ways wecan reducecosts?

•People andimplemen.

•Financing

1 - Merge, Acquire, Joint VentureBarcelona based airline, acquire smaller player

Takeaways

• Always explain“synergies”. Arethey revenue orcost? Be specific.

• Think practically.How quickly can thedeal be done?

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2 – Growth StrategyCairo bus company wants to be prepared for growthwith new government spending on transportation.How?

Strategy

Operations

OrganizationFinance

People

Systems

Processes

Measure

.

CA$H

D/E

SP E C I A L

T

Zone 1

Zone 2

Zone 3Zone 4

Zone 5

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4

R

C

VolumeMixPrice

FixedVariable

Customer

1

2

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Cairo bus comp – howgrow?

•Who isgrowing?

•Alternativesto thisoption?

•New tech,suppliers,legislation

Growthoptions

Funding Cost s

Facts

Data

Plan

•Products?

•Channels?

•Marketing?

•How willwe supportnewinitiatives?

•Govt.fundingavailable?

•What do weneed tospend togrow?

Industry/Comp

2 – Growth StrategyCairo bus company, government money, growth

Takeaways

• Check forsustainability. Willdemand suddenlydrop off?

• Are there specialsources for funding?

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3 – New business or productPlainfield Industries in South Dakota just developeda low water, “dry corn”. How should they launch it?

Strategy

Operations

OrganizationFinance

People

Systems

Processes

Measure

.

CA$H

D/E

SP E C I A L

T

Zone 1

Zone 2

Zone 3Zone 4

Zone 5

4

3

R

C

VolumeMixPrice

FixedVariable

Customer

12

333

5

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How do we launch dry corn?

•Newdirection forproducts?

•Add tootherproducts?Newportfolio?

Revenuegrowth

Broadoverview

Org &Fin

Facts

Data

Plan

•What isdemand?

•Year 1revenue?

•Cannibalizeother prods?

•Any supplyissues?

•Comp. – arewe ahead?

•Industrybarriers?Patents?Regulations?

•What do weneed to doto supportnew prod. &sales?

•How manyyears toinvest?

Strategy

3 – New business or productPlainfield Industries, dry corn, launch

Takeaways

• With new products,considercannibalization.

• What are youassuming to be truewith the launch?

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4 – Enter new geography or marketFoundation Bank wants a large piece of the Istanbulbank card market. Should they enter a new country?

Strategy

Operations

OrganizationFinance

People

Systems

Processes

Measure

.

CA$H

D/E

SP E C I A L

T

Zone 1

Zone 2

Zone 3Zone 4

Zone 5

4

3

R

C

VolumeMixPrice

FixedVariable

Customer

12

333

5

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Enter Istanbul? Challenges?

•WhyIstanbul,Turkey?

•Sameproducts asbefore?

•Strength incards?

Revenuegrowth

Broadoverview

Org &Fin

Bank cards onlyused by 30% ofpeople

Data

Plan

•Can webuild interestin ourproducts?

•Bank cardsrequiresupportstructure.Machines?

•Any supplyissues?•Comp. –who’sdominant?•Industrybarriers toforeigncompany?

•Do we havepartners inplace?

•Will webuild newbanks?

•How muchto fund?

Strategy

4 – Enter new geography or marketFoundation Bank, Turkey, card market

Takeaways

• What is the sameand what isdifferent?

• Use a “broadbucket” to groupseveral small ideas.

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5 – Maximize profitUniversity Catering (UC) is facing declining profits.How would you help them?

Strategy

Operations

OrganizationFinance

People

Systems

Processes

Measure

.

CA$H

D/E

SP E C I A L

T

Zone 1

Zone 2

Zone 3Zone 4

Zone 5

R

C

VolumeMixPrice

FixedVariable

Customer1

2

3

Data

Plan

5 – Maximize profitUC is facing declining profits. How would you helpthem?

Facts

TT

R

C

P

V

VC

FC

Pricepressure?

Did we trynew prices?

Segmentstability?

New player inmarket?

Trend by costcategory

Any upwardshift?

Are we ableto compete?

Takeaways

• Explain eachvariable – don’tskim over them.

• Be ready to diveinto one specificvariable. Develop ahunch every time.

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40

6 – Change priceYellow Brick Road Distribution will be discontinuingDVD sales of 1/3 of their titles. How should theyprice?

Strategy

Operations

OrganizationFinance

People

Systems

Processes

Measure

.

CA$H

D/E

SP E C I A L

T

Zone 1

Zone 2

Zone 3Zone 4

Zone 5

R

C

VolumeMixPrice

FixedVariable

Customer1

2

3

4

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How should YB price?

•Historicalresponse topricechanges forDVDs?

Compet. Price Measure

Data

Plan

•How arethey pricingproductstoday?

•What is thepricevolumerelationship?•Do we haveto matchprices ofcompet.DVDs?

•How will weknow ourstrategyworked?•How will wemeasure?

Customer

6 – Change priceYellow Brick, discontinuing products, DVD pricing

FactsTakeaways

• Go through the 3main pricingstrategies for thesecases: cost plus,competitors andmarket based (howmuch will theypay?)

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7 – Streamline a ProcessMexican government wants to accelerate economicgrowth by increasing the speed of the business loanapproval process.

Strategy

Operations

OrganizationFinance

People

Systems

Processes

Measure

.

CA$H

D/E

SP E C I A L

T

Zone 1

Zone 2

Zone 3Zone 4

Zone 5

R

C

VolumeMixPrice

FixedVariable

Customer

1

2

34

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How should govt. streamlineloan approval?

•Whosupportsthisprocess?

•What isthe flowoverall?

Compet. Rev/Cost Measure

Data

Plan

•What canwe learnfrom othergovts.?

•How aboutbanks?Otherbench-marks?

•How canwe measurecosts?Workers?Time perloan?•Approvedamt / loan?

•How will wetrack thespeedimprove-ments?

•What timeis good?

People /Flow

Facts

7 – Streamline a ProcessMexican government, business loan approval process

Takeaways

• Break down theprocess.

• Think about thepeople, actions andspend per step.

• Think of the valueadded per step.

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8 – Restructure the teamEnrique, a Colombian chocolate maker wants to govertical and restructure the team? How should theyallocate resources?

Strategy

Operations

OrganizationFinance

People

Systems

Processes

Measure

.

CA$H

D/E

SP E C I A L

T

Zone 1

Zone 2

Zone 3Zone 4

Zone 5

R

C

VolumeMixPrice

FixedVariable

Customer

1

2

3

4

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EnriqueHow do we realign the team?

•Who willsupportthisprocess?

•What isthe flowoverall?

Costs Rev/Impact

ProcessSteps

Data

Plan

•Costsassociatedwith eachfunction inthe process?

•How willthey changeunder eachoption?

•How do weallocateresources ina profitmaximizingway?

•Map outeach processstep

•How caneach step beoptimized?

People /Size

Facts

8 – Restructure the teamColombian chocolate maker, align team in new way

Takeaways

• Break down theprocess (just likeprocessimprovement).

• Align people to thesteps.

• Stay analytical.

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9 – Competitor AttackA small, custom, art paper maker in Rome Italy isfacing a flood of new products from China. How wouldyou help them?

Strategy

Operations

OrganizationFinance

People

Systems

Processes

Measure

.

CA$H

D/E

SP E C I A L

T

Zone 1

Zone 2

Zone 3Zone 4

Zone 5

R

C

VolumeMixPrice

FixedVariable

Customer

1

23

4

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How respond to competition?

•Howcompeting?•Price, newinnovation, betterdist.?

Rev /Costs Srategy Action

Steps

Data

Plan

•Overallimpact?•Whichproductlines?•Have ourcosts beenhurt at all?

•What kindof largeactions canwe take?•Dropprods?•Introduceinnovation?

•What has tochange?•Processsteps?•Teamalignment?

Compet.

Facts

9 – Competitor AttackCustom, art paper maker, new product competition

Takeaways

• What’s thecompany’s “superpower”?

• Consider strengthsfirst before goinginto new areas.

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10 – Market Shift (industry, tech, supply)Ohio drug company faces significant drop off in sales oflead products. How will Japanese lab supplier respond?

Strategy

Operations

OrganizationFinance

People

Systems

Processes

Measure

.

CA$H

D/E

SP E C I A L

T

Zone 1

Zone 2

Zone 3Zone 4

Zone 5

R

C

VolumeMixPrice

FixedVariable

Customer

1

2 34

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Japanese drug comp /Change in consumption

•How is theshift takingplace?•What isthe specificimpact?•Implica-tions forotherprods?

Rev /Costs Organ Strategy

Data

Plan

•To whatdegree is thedrop off/•How willthiscontinue?•Can sales bebroughtback?

•How do werealign ourpeople,systems andtechnology?

•What prodsor drugs canwe launchnow to slowthe decline?

ExternalForces

Facts

10 – Market Shift (industry, tech, supply)Japanese drug company, drop off in product sales

Takeaways

• Consider time tomarket and payback.

• Don’t try to stay inthe same space ifthe shift is strong.

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Get Faster Each TimeGet Faster Each Time

Homework – Give & Receive 6 Starts (10-15 mineach)

Boston College - SAI Structuring Business Problems College - SAI Structuring Business Problems Rikin...

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