How to approach the following type of questions?

Question

(Sorry if this is a stupid question)

Suppose the purpose of the case is to improve a metric like cost/revenue/profits/time quantitatively, for instance:

1. How will you help our client increase 50% profits by next year?

2. Reduce costs by 25% by next 2 years

What is the correct way to reach a solution in either case?

I understand that the answer would be based off the data provided to the candidate at the time, but which resulting metric would be considered the best answer in both cases?

Could some of those metrics be penetration rate/CAGR/profit margins in case of increasing revenue/profits?

What about costs?

Thank you so much for any kind of guidance in advance!

Answer 1

Hi there,

In terms of what metric you use it truly depends on the case! You need to let the case “tell you” what's needed.

That said, when it comes to increasing profits, you can do this by increasing revenues, decreasing costs, or both. If reducing costs, all you can do is cut costs!

The “metric” to use is literally just going to be $ or %…and trying to reach the target they've set!

Answer 2

For the example you have given, this is your classic profitability case. So use that framework and work with data/info provided to drill into revenue or cost or both. Not sure what's confusing you?!

Answer 3

Hello and thanks for the question. According to my experience, there is no such thing as a “typical” working day in c... (read entire answer)

Hello and thanks for the question. According to my experience, there is no such thing as a “typical” working day in consulting, as the environment is too dynamic and every proje... (read entire answer)