Hello!

It completly depends on the target of the case, type, etc. (e.g., there are "exploratory" issue trees where you want to lay out all factors that would influence a business decision, others that consist in laying out different options -such as growth ideas, for instance- and commenting pros and risks, etc.)

A priori, I would not start with laying out a hypothesis at the beggining, before even problem-solving with the interviewer. What would be the advantage of doing this?

Hope it helps!

Cheers,

Clara

Hi,

First of all - Hypotheses are not mandatorily required. I would say - use the hypothesis if you are really good at solving the cases. If not - use the basic approach

There are two ways to use the hypothesis:

First - presenting a structure using the hypothesis. For example, if you are having a PE (private equity) case, you should do the following:

1) Make classic structure (market, company, competitors, feasibility of exit)

2) Make subpoints (e.g. in market: size, growth rates, profitability, segmentation, etc)

3) Present your 1st level Hypothesis:

• - "In order to understand whether we should invest in Company A, I would like to check that the Market is Attractive, the Company is Attractive, the competition is favorable and we have good opportunities for of exit"

4) Present the main 2nd level Hypothesis:

• "In the market, I would like to make sure that the market is big enough and growing;
• In the company I would like to find additional opportunities for growth;
• In competition I would like to check that the market is fragmented enough;
• Finally, I would like to check if we have potential buyers and can achieve desired exit multiples"

Another way to use a hypothesis is by using the hypothesis to prioritize your analysis:

1) Make a structure: "Problem in sales may be related to Sales Motivation, Sales Strategy, Sales Coverage, and Sales Process:

2) Prioritize a part of the structure based on your knowledge / common sense / available data: "Taking into account that motivation is the core problem of the sales organization, I would like to prioritize this part of the analysis"

Good luck!

Hi Jagtar,

you can use a hypothesis whenever you have to verify if a part of the structure you presented is relevant. Specifically, to use a hypothesis you should:

• Define a structure to answer the question of the interviewer
• Define a hypothesis on one of the areas
• Explain how you want to verify the hypothesis and ask information to the interviewer to proceed

If the interviewer for example asks where you want to start a cost analysis, you could answer:

“Well, costs can be divided in fixed and variable costs. Given the initial information I received so far, my hypothesis is that this could be a fix cost problem; to verify this hypothesis, I would like to know how fix and variable costs changed. Do we have any information on that?”

Therefore, by definition it makes sense that (1) you state the hypothesis after presenting a structure, not before and (2) you ask for data to verify the hypothesis after you stated it.

Hope this helps,

Francesco

Hello Jagtar,

Victor Cheng's approach is super but could be a bit confusing, especially if you start from scratch. I suggest to take a look of the Cosentino's "Case In point" that is easier and less complex for the first approach with case interviews.

Best,
Luca

I recommend starting practice cases without struggling with the theory of making a hypothesis. After 15+ cases it will became very logic to you