Agenda
1. The interview process
2. The Casea. Problem Typesb. Frameworksc. Live Case!
3. How to prepare
“We’re looking for logical, creative people who can think on their feet. The whole interview process is designed to locate these people.”
-- Tom Tierney, Former Worldwide Managing Director, Bain
What are they looking for?
What are they looking for?
Behavioral • Achievement• Personal impact• Leadership• Communication
Case Interview• Communication• Problem Solving • Analytics• Business Acumen
Exact terms vary by firm, but generally they fall into these categories…
Full-Time Interview Process
• Very similar, if not identical, to Summer recruiting
• Look at firm websites and talk to classmates / firm alums to identify firm nuances:
– e.g. Monitor (group interviews, written cases), McKinsey (more structured interview)
• Interviews vary by firm but generally follow:
# Cases2 (basic cases
and part fit)2-3 (wide range
of cases)
# Behavioral 0 1-2
Interviewers Managers Partners
Round 1 Round 2
Agenda
1. The interview process
2. The Casea. Problem Typesb. Frameworksc. Live Case!
3. How to prepare
Typical Consulting Interview
5 min
Introduction
25 min
Fit Portion
10 min Total:
45 mins
– Some variability among consulting firms– Typically 1-2 interviews in first round, 30 – 45 minutes each– If there are 2, 1 is typically more case heavy, 1 more fit heavy
Q&A
5 min
Most common
15 min
Fit portion
30 min Total:
45 mins
Less common
The Case Interview• Firms want to see how you think
- Verbalize what you are thinking
• Show your work- Your paper is your friend
• You need an initial structure- Know the main types of cases!- Apply structure to an ambiguous problem….but….- Don’t be too rigid – use frameworks loosely
• Practice makes perfect!- Do enough cases to get over ‘the hump’
• Cracking the case is absolutely necessary, not sufficient!
The Case Interview – Feedback• Don’t use a canned framework
– Have a personal approach demonstrating your logic and structure
– Not every case can be solved with a profitability or market entry framework
– Apply personal knowledge of industry where applicable
• Don’t get entrenched in your framework– Integrate your framework into the discussion rather than sticking strictly to it
– Look for cues from the interviewer for alternate paths not included in your framework
– Identify cases that the interviewer worked on personally and adjust accordingly
• Focus your approach– Always remember 80-20 rule
– Prioritize most important points first
– Drive progression through the case
The Case Interview – Structure
Structure / Framework
Hypothesis & Analysis(with Public Math and Data Analysis)
Conclusion / Recommendation
First 5 minutes
Next 15-20 minutes Last 3-5 minutes
Analytical skills
Creative thinking
Communication skills
“Grace under pressure”
Conceptual thinking
Organization of thought
Ability to synthesize
Cracking a Case
Step 0: Clarify the problem• Listen closely to problem definition• Ask questions to improve understanding• Paraphrase to confirm problem statement/objective
Example:• “So, our task is to improve the bank’s operating results by
$100M in the next two years, correct? Are there any other objectives I should be concerned with?”
Solve the right question!
Cracking a Case
Step 1: A structured approach
• Take a brief pause to organize your thoughts– It’s as simple as asking permission to take a moment to structure
the client problem Ask for time in your own style Keep it to ~1 min or less
• Take structured notes to convey your story:– Cover page: 3 sections to capture overview, structure, summary– Add points to your summary as you go– Refer back to your framework throughout interview
Cracking a Case• Organize the rest of discussion per your framework:
– Start by walking the interviewer through your framework
– Use the notes you have taken as a guide Organizing pages as slides may be beneficial Using slides will tell your ‘story’ when making your recommendation
StructureOverview
•Profit- Revenue- Costs
•Consumer Demand- Distributors- End consumers
•Competition- Position?- Response?
One
Two
Three
Summary
Customer Demand
Target Consumers
Size Growth
A 2.5M 15%
B 1.8M 25%
Cracking a Case
Step 2: Prioritize the problem
4 areas to explore – what’s most important?• Eg: Increase number of customers:
– Add more new customers
– Lose fewer current customers
• Eg: Increase revenue per customer:– More lending
– More cross sells
Seek data to prioritize
• Start by Validating your own hypothesis
– But do not be married to this initial hypothesis
• Ask relevant intelligent questions
– Beware of going into ‘question mode’. You are the interviewEE not the interviewER
– Questions must have a logical flow
– Ask one question at a time
– Talk the interviewer through why you are asking what you are
• Show creativity and curiosity
• Watch your interviewer!
– His physical ‘tells’ are the easiest way to know when you are on the right track and when you are straying off course
Cracking a Case
Cracking a Case
Step 3: Define a solutionWork with the interviewer to define the best solution
A good solution is:
1. Best among alternatives
2. Practical
3. Based on facts
4. Supported by client
Articulate a recommendation
Cracking a Case
Analytical Skills
1. Comfortable doing public math
2. Identify required data• Product 2’s margin increased
by 20%, what is new profit?
3. Handle units • 140M / 35k
4. Identify underlying assumptions
• Sales decrease of 10%
• Profit decrease of 10%
5. Spot mistakes!
Communication Skills
1. Attitude is confident, but not cocky
2. Listening skills
3. Asks appropriate clarifying questions
4. Shows work
5. Exudes Positive Energy
6. Synthesizes / Summarizes– “Given the key points we
have just discussed, we need to take advantage of our scale to drive lower costs”
Elements tested throughout a case:
Public Math
• There is no reason to rush – be deliberate
• Lay out your math clearly in a tabular form so it is easy to follow
– People approach math differently – the interviewer should always know what you are doing
• Write down the units you are dealing with – this is often your undoing
• Remember that an error is not the end of the world as long as you recognize it quickly and move on
Articulating Your Case• Demonstrate a structured, logical, and thorough thought process
• Use your notes as you work through your case
– Layout quantitative data in charts when possible
– Show (and talk through) your calculations!
– When needed, make explicit assumptions
• Sample Case Opening for Interviewee:
“In order to determine why Firm X has experienced a decline in profitability, I would like to investigate three areas: (1) the various elements that make up profit, namely revenues and cost; (2) customer demand and whether we are still delivering value for our customers; and (3) changes in the competitive environment.
Since you mentioned that Firm X has seen its product mix change over the past year, I would like to begin by analyzing the firms revenues, focusing first on pricing. It could be that a poor pricing structure is causing Firm X’s profits to suffer…
Do we have any information on product prices over time?”
Be confident and keep your cool
Listen well – ask clarifying questions
Show energy – even if it’s your 7th interview of the day!!
Have a sense of humor
Don’t forget the fit
Smile!!
Overall Interview Tips
Agenda
1. The interview process
2. The Casea. Problem Typesb. Frameworksc. Live Case!
3. How to prepare
Main Problem Types
Typical case types involve one or more of the following:
1. Industry Analysis
2. Profit Improvement
3. Capacity Expansion / Rationalization
4. Market Entry
5. Acquisition
6. Investment Decision
7. Market Sizing
Industry Analysis• Easily recognized by cases that ask whether firms
should be in an industry, or by cases that lead to the entire industry doing poorly
• Usually part of a larger case
• Approach
– Generally, point will be to determine if this industry has desirable economics
Structure: Value Chain, Who are suppliers/buyers, Distribution channels
Competition: Number, Market Share, Geography, Position, Distribution, Relative Strength/Weaknesses, Response, Strategic blocking - Distribution, Price cuts, etc?
– Can use Porter’s 5 Forces (without saying so)
Profit Improvement• “My client has been experiencing declining profitability. Why?”
• Approach:
– Determine what has changed/is different/is causing problems and why
How do they make money?
What does the cost structure look like?
– π = [(P – VC) * Q] – FC
Use this formula to catch distinction between VC & FC
Breakeven quantity = FC/(P – VC)
– Focus on factors that impact these variables, listening carefully for clues
“Firm X experienced difficulty in labor relations last year…”. This is probably indicating a recent increase in VC due to wage increases…
– Identify if particular product lines within the company are causing an issue
Capacity Expansion / Rationalization
• “Company X has decided that it needs to expand its manufacturing capacity and is considering building a new plant in Lima, Peru, or increasing the scale of its current plant in Buenos Aries. Should the expand, and if so, where?”
• Approach:
– Industry: Is there excess demand/How big is the pie?
– Company: For what segment are we expanding capacity? How flexible/adaptable will the new capacity be?
– Competition: How big a share of the pie can we capture?
– Understand the costs and benefit of new operations Workforce, transportation, technology, time to completion
Consider all alternatives: build, lease, outsource, acquisition, divest
Find the important aspect and focus there
Market Entry• “My client is thinking about launching a new product. Is this a good
idea/should they do it?” Recognizable by cases with firms seeking to expand into a new region, business, or customer segment
• Approach:– Understand the industry & size the market (make assumptions)
– Look at what the competition does
– Consider consumers Analyze customer needs to identify potential gaps (make an assumption about initial
market share)
– Look at company’s ability to meet these gaps Capabilities, costs, segments served
– Quantify potential profits and costs (Conduct an NPV analysis) Evaluate methods of entry and barriers (if they exist) Positive NPV does not necessarily imply a go (or no go)
• Consider risks; Is this move a strategic imperative?
Acquisitions
• “My client is thinking about merging with company B. Is this a good idea/should they do it?”
• Approach
– Understand context of merger decision: “does this fit?”
– Assess Benefits/Costs Does it increase resources: capacity, distribution reach, broaden product
line, etc.? Does it decrease costs: economies of scope, economies of scale,
movement along the learning curve?
– NPV analysis – compare costs vs. benefits
– Consider competitors response and possible organizational issues
– Alternatives to this acquisition: Other targets? Organic growth?
Investment Decision• Listen for indications of companies considering
purchasing new assets (e.g. “Firm X is considering adding capacity to increase its output of Product A…”)
• Approach
– Understand the firm’s business
– Why is it considering the investment?
Need to be industry leader?
Required to stay/become competitive?
– NPV analysis
Including option value
– Consider competitor response
– Summarize with position on making investment or not
Market Sizing• Recognizable as requests to determine the size of an
opportunity• Market sizing is often a part of a broader issue
– e.g. “Company X, the world’s leading light bulb manufacturer, obtained a patent for a light bulb that will never burn out. Should they develop this product?”
• Approach– Share clear assumptions and estimations with the interviewer– In many cases, you will have to guess
No one who interviews knows how many light bulbs are sold in the world…
– Rounding is usually okay – just be sure to indicate this to the interviewer
– Remember to vocalize your calculations
Agenda
1. The interview process
2. The Casea. Problem Typesb. Frameworksc. Live Case!
3. How to prepare
Select Frameworks for Consideration
Tools you use to solve different types of problems. Use frameworks ‘loosely’
• Porters’ 5 forces
• Profitability: Profits = Rev – Cost; Also Profits = [(Price – VC) * Q] – FC
• Cost/Benefit analysis
• 4Ps (Product, Price, Promotion, Place)
• 3Cs (Customers, Competition, Collaborators), 4th C = Company / Context
• Value Chain analysis
• Market Segmentation and SPSG (Size, Profitability, Share, Growth)
• NPV
• Internal Factors (capabilities, sales force incentives, etc.)
• External Factors (Government regulation, tariffs, etc.)
• Micro Economics: Demand curve, elasticity, pricing and arbitration
Agenda
1. The interview process
2. The Casea. Problem Typesb. Frameworksc. Live Case!
3. How to prepare
Agenda
1. The interview process
2. The Casea. Problem Typesb. Frameworksc. Live Case!
3. How to prepare
Case PreparationNow:
• Focus on firms / offices
• Start practicing for case interviews
– Practice with a variety of people: people you know, people you don’t know, people from different firms
• Connect with Mentorship team
• Attend prep sessions (Club and corporate)
Closer to interview:
• Identify nuances of firm-specific interviews
• Practice firm specific cases for those with whom you have been selected to interview
Fit Preparation
You can always start thinking about the fit…
Walk me through your resume Why Consulting? Leadership Experiences Achievements Failures Strengths and Weaknesses ........
37
CC Frameworks 10-04
Resources
• Kellogg Consulting Club Website:
– http://www.kellogg.northwestern.edu/student/club/consulting/
• Kellogg Consulting Case Book
– Also use other school case books
• Peers & Case Groups
– You will need to spend a lot of time with friends
– Go beyond the formal Mentorship Program
• www.vault.com
– General information on consulting and consulting firms
• Consultants
– Reach out to firms for interview assistance
– Mock interviews in CMC
Suggestions
• Before starting to practice your interviewing skills, review the resources
– Understand how a case works (Kellogg casebook)
Find the resource that “speaks to you”
– Understand frameworks and different types of cases (Kellogg frameworks)
• If you want to try some cases
– Harvard casebook has some short ones, Vault and Wetfeet also have cases suitable for individual practice
– Find someone who has cased before to give you one
Next Steps
• Learn the frameworks so they become routine– Then, erase the term ‘framework’ from your mind
• Practice cases with your peers– Not uncommon to take 20+ cases to get in the swing of it
– Keep practicing until you reach the ‘tipping point’…then, STOP
– Quality over quantity
• Outline your stories for your fit interviews– Practice delivery with peers, spouse, bathroom mirror, etc.
• Get to know the firms– Styles vary: do they want hypotheses up-front? How structured is the case?
Will there be a fit interview in Round 1?
– Do not underestimate the power of networking
– People make the offer decisions at the end of the day
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