Schedule mock interviews on the Meeting Board, join the latest community discussions in our Consulting Q&A and find like-minded Interview Partners to connect and practice with!

Emily

on Jun 10, 2025

USA

Question about

Confusion on 3-year profit target.

Hi! -- I have a clarifying question about this calculation.

So the case says the following

The goal of the client is to increase profits by 10% in three years
The client’s most recent profit was $500M

So it seems you could achieve this goal in 2 ways, depending on how you interpret it:

1. making 500M x 1.1 = 550M in year 3 alone (so 50 M extra)

2. or making 500x3x1.1 = 1650M total across the 3 years (so 150 M extra)

However, at the end of the calculation, it is assumed that the combined profit target across the 3 years is just 50 M. I am confused why this is correct, as 50 M is not a 10% increase on what you otherwise would've made across 3 years (1500 M)

200+

Be the first to answer!

Nobody has responded to this question yet.

Top answer

Hagen

Coach

on Jun 12, 2025

#1 recommended coach | >95% success rate | 9+ years consulting, interviewing and coaching experience

Hi Emily,

I see that Francesco will edit the rather ambiguous wording, which should resolve the issue.

You can find more on this topic here: How to succeed in the final interview round.

If you would like a more detailed discussion on how to best prepare your application files, for your upcoming pre-interview assessments and/or interviews, please don't hesitate to contact me directly.

Best,

Hagen

Phenyo

Coach

edited on Jun 10, 2025

Ex-McKinsey Consultant | Nova Top Talent - Madrid | McKinsey HiPo recruit | McKinsey Digital & Analytics

Based on the wording, it seems accurate. In a live case, you would have needed to clarify your understanding to ensure you’re on the same page.

So the interpretation was based on the goal to increase profits *in* 3 years (for year 3) *by* 10% (assume it is relative to today). Also, for a business, the year 2 profits would be irrelevant as the goal is measured on performance of year 3, so no ramp up needed

1 comment

Emily

on Jun 10, 2025

This is where I was confused as in the calculation it looks like they are considering the year 2 profits -- and then the sum of year 1 and 2 profits is compared to the profit target in year 3 alone.
Would it not make more sense to compare the profits in just year 3?

Francesco

Coach

on Jun 11, 2025

#1 Coach for Sessions (4.500+) | 1.500+ 5-Star Reviews | Proven Success: ➡ interviewoffers.com | Ex BCG | 10Y+ Coaching

Hi Emily,

Thanks for solving my case! I confirm that the goal is to increase profits by $50M over the next three years. I agree the text is not very clear in terms of that, I will edit it to clarify it, thanks for pointing this out.

Best,

Francesco

2 comments

Emily

on Jun 11, 2025

Hi Francesco,
To clarify, if we are adding up the new profits of yr1,2&3, I am wondering why you don't compare this to what the profits would've be for all 3 years? Since you used to make 500M/yr wouldn't you have made 1500M in 3 years and thus 10% of this is higher than 50 M?

Francesco

Coach

on Jun 11, 2025

#1 Coach for Sessions (4.500+) | 1.500+ 5-Star Reviews | Proven Success: ➡ interviewoffers.com | Ex BCG | 10Y+ Coaching

Hi Emily, happy to clarify, as the goal is to achieve $50M more overall within 3 years, I will edit the text to make it clear using the absolute number rather than the percentage, which could indeed be confusing. Hope this helps.

Ihssane

Coach

on Jun 11, 2025

McKinsey manager | -50% off first session | 7+ years in consulting| Case & Fit Interview Coach | Free intro session

My understanding when I first read the question is that it seems quite straightforward : we want to increase our current profit (500M) by 10% in 3 years, meaning simply an increase of 50M in year 3. Of course you could clarify this orally in a real case scenario.