My question is when should you say your hypothesis? .
Scenario 1 : there are two main drivers for profit which is revenues and costs. This is my main two buckets and before I dive deep into them my initial hypothesis is xx
Scenario 2: i read out my whole structure then state my hypothesis.
And how wide is the hypothesis in the beginning? What could it be for example for a profitability case?
I get this question a lot, and I think there’s a common misunderstanding here.
A hypothesis is not a guess. It should be based on some evidence or logic, not something you “throw in” at the start.
So for your two scenarios: I wouldn’t do either. Stating a hypothesis right after reading the prompt or right after your structure is, in most cases, just guessing; and that doesn’t add value. At the beginning of a case, your job is to:
Not to predict the answer without data.
The only exception is if you have very specific prior experience in that exact industry; then you can say something like: “In similar situations I’ve seen X being the main driver, so I’ll keep that in mind as we analyze.”
But even that should be light, not a strong claim.
The right moment to use hypotheses is during the analysis. For example, after looking at a chart or doing a calculation, you can say: “Based on what we’re seeing, I’d hypothesize that the issue is coming from X rather than Y.”
That’s much stronger because it’s grounded in evidence.
For a profitability case, a good hypothesis would be something like: “Given revenues seem stable and costs have increased, I’d focus on cost drivers as the likely root cause.”
Bottom line: don’t force a hypothesis at the start; build it as you learn more.
Hope this helps,
Franco
Hey Anonymous
Thanks for your question. I hear this daily from my coachees, and I honestly think that there's some confusion going on.
The basics
Hypothesis in the structure phase is not needed in standard MBB case interviewing. It's something that has been emerging, particularly in the US post-MBA market, where Firm coaches (often assigned by their firms to help candidates from specific universities) sometimes suggest stating a hypothesis as early as possible, including during the structure. I heard this from my coachees at Berkeley a few times, but even in the US this is not the norm.
The reason is simple: it's true taht consulting is a hypothesis-driven business and you want to start as early as possible to develop an hypothesis. However, you need solid data or solid evidence (or at minimum some qualitative context) before you can develop a meaningful assumption. Without that, you're just guessing.
Your scenarios
Based on that, neither scenario 1 nor scenario 2 works for me.
So when should you actually use it?
A. The first and most important principle is that you should always be hypothesis-driven from the very first piece of data you receive after your structure. The moment you get a number or a fact, you should be asking yourself: what does this tell me, and what hypothesis can I build from it? This is exactly where many candidates fall short: they read the data out loud and stop there, without developing any forward-thinking assumption from it.
B. The second moment is more of an edge case that happens in roughly 10-15% of cases: it is when your clarifying questions turn into a genuine conversation, one where you develop a real understanding of the industry and the situation before you even structure. This happens more often with senior partners. In that case, you might have enough context to frame an hypothesis, and importantly, it doesn't have to be a hypothesis on the solution. It can be a hypothesis on where to focus your analysis.
--> Here's a concrete example of case B. It's an M&A case, and during the clarifying questions, you learn that asset prices are very high, that the industry is very scale-dependent, and that you are client is an industry-leader in cost management. You could say something like:
"Before I lay out my structure, I want to flag an initial hypothesis: given current asset price levels, this M&A activity will only generate value if cost synergies are well-developed, relevant, and implementable within a one to two year window." That's not a full answer, nor a standard hypothesis, but it's a well-reasoned intuition that narrows the scope of where you'll focus most, and that's exactly what makes it useful. I would still caveat it with "I would focus first on this hypothesis" -- this way you show that you know that this intuition might also be wrong :)
A word of caution
Even in case B, watch out: if you force it, especially in the European market, most partners will question why you're building an hypothesis before you have any data. If it doesn't feel natural, don't do it.
Hope this helps!
Best,
Tom
That's a great question.
A hypothesis is a belief supported by evidence. When you have overwhelming evidence, then it becomes a recommendation.
So you should communicate a hypothesis when you have data from within the case that allows you to support that belief.
The earlier you do it, the better.
However, if you don't have supporting evidence, then you don't have a hypothesis, so refrain from communicating one prematurely.
Best,
Cristian
