Hi everyone!
I’ve worked through a large number of cases and noticed a recurring challenge. Many cases present a problem (e.g. declining profits or rising costs) and explicitly ask for both an identification of the root causes and a strategy on what the client should do about it.
I think I have no difficulty structuring the diagnostic part. In a cost-cutting case, for example, I typically start by breaking down the value chain, identifying the largest cost drivers, and benchmarking them against competitors or historical performance. From there, I assess potential internal and external drivers to arrive at the most likely root causes.
What I find more challenging is the strategy formulation part when it is already embedded in the initial question. At the structuring stage, the underlying issue is still unknown, which makes it difficult to define a truly tailored cost-reduction strategy. As a result, I often formulate preliminary hypotheses on potential countermeasures for underperforming cost levers. However, this feels more like a generic brainstorming exercise than a structured, case-specific problem-solving approach...
At the same time, I also want to avoid presenting a purely sequential “project plan” framework (e.g. first diagnose, then counter measures), even though most of my frameworks inherently have a sequential logic. I’ve also seen candidates focus entirely on the diagnostic phase and explicitly state that they would only assess countermeasures after gathering more information during the case. Is this the right way to do it? That approach feels unsatisfactory to me, as it risks making the initial structure less tailored if the forward-looking element is completely omitted.
To illustrate, consider the following example:
A European airline’s CEO approaches you with the objective of improving the bottom line by coming up with a cost reduction strategy to reduce costs by 25% over the next three years.
My instinct would again be to start by identifying and benchmarking the largest cost drivers to size the main cost-saving opportunities, using an issue tree. Then, I would formulate initial hypotheses on potential cost-reduction levers and define clear criteria to evaluate them later in the case, for example:
- cost impact,
- operational feasibility given the relatively short time horizon, and
- potential brand or customer impact
Thanks a lot for your help!
