Any insights on how to go about solving a case study on a government owned/public sector company?

case partner MBB
New answer on May 08, 2020
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Anny asked on Feb 27, 2020

Hi Team,

First of all thank you for all your valuable insights. They are extremely helpful. While I find it relatively easy to solve private sector company's case studies, it becomes a little tricky while solving a public sector/ government owned company's case study (for.eg a utility company). Can you please provide some inisights on how to go about such cases?What should one keep in mind while solving such cases?

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Ian
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replied on Feb 27, 2020
MBB | 100% personal interview success rate (8/8) and 95% candidate success rate | Personalized interview prep

My approach

Public sector cases are tricky because they feasibly be any case type (Product Launch - new service for citizens; M&A - merging two departments; even Profitability - cost cutting mandate). For any public sector case, I recommend:

  1. First identifying the type of case it is.
  2. Second, leverage your knowledge of the public sector as constraints/considerations.

Considerations/Constraints

Regards #2, you know that public perception is particularly important to consider in any public sector move. Additionally, you can count on bureacracy/slowness in implementation. You should identify the goal/mission of the organisation as well and keep this top of mind (if it loses money, but achieves it's goal of helping the poor, no problem). Howvever, just because the government sector doesn't have profit as a target, doesn't mean you should ignore the profit tree altogether - governments are still obliged to take into costs (and sometimes revneues) in decisions (example: setting up a public transport initiative). Don't get tricked into thinking you can't consider the economics of the case!

Other items to consider include, but are not limited to:

  • Politlcal landscape (i.e. upcoming elections, special interest groups)
  • Sustainability
  • Private-public partnerships
  • International vs governmental vs state vs local partnerships/alignment
  • Income = taxes/budgetary landscape
  • Digitialization of government

Framework Resource

In terms of resources, the UPenn Wharton 2011 casebook has a framework for public sector. It's split into:

  1. Strategic rationale (Mission of organisation and stakeholder reactions)
  2. Deal economics (planned investment and returns, if any)
  3. Other (Required capabilities and risks)

Practice Cases

If you want some practice cases:

  • Tepper 2008's "NGO Effectiveness"
  • Colombia 2011's "MadeCasse"

Hope this helps, and please don't hesitate to ask any follow-up/clarifying questions!

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Anny on Mar 02, 2020

Thanks for the detailed insight.. Appreciate your help!

Anonymous replied on May 08, 2020

The fundamentals of how you solve a business case is not depend on the industry/sector the company is in. The way your approach a problem should be similar.

The only thing you might want to be aware of and pay attention to is that gov owned / public sector company might have slightly different object or priority. E.g. employment could be an important objective besides econimic benefits, which could have some implication on the solution you provide. Ask about the company objecive and constraints early in the case.

Best

Emily

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Clara
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replied on Feb 27, 2020
McKinsey | Awarded professor at Master in Management @ IE | MBA at MIT |+180 students coached | Integrated FIT Guide aut

Hello!

I always suggest my coachees not to focus on the industry, but type of case (e.g., profitability, M&A, pricing, market entry, etc.)

Hence, if you cannot find more than a couple of PS cases to practice, don´t worry! The way I see it, it´s impossible to have insights about all industries. It´s too time consuming, and that time can have a much better ROI in other parts of the prep.

Hence, if you practice enaugh (and this means +50 cases), you will came across almost all common industries. This will give you the basic insights for the interviews. Precisely not to have to study the intrinsics of every industry, it is key to have an approach to cases that is holistic and ambibalent, to ensure it can work with all of them.

This is precisely the focus of my coaching sessions with my coachees, PM if you want.

Hope it helps!

Cheers,
Clara

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Anny on Mar 02, 2020

Thanks Clara.. Appreciate your response!

Luca
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updated an answer on Feb 27, 2020
BCG |NASA | SDA Bocconi & Cattolica partner | GMAT expert 780/800 score | 200+ students coached

Hello,

The public sector cases are not completely different from standard cases. The critical point is to clearly identify the objective of your client that could be really different from standard cases (often non-monetary). You should stress this part, asking for clear definition and target. For example "To improve the Healthcare system" could be transformed in completely different analyses (do we want to increase the quality of our system?Or do we want to make it more accessible for everyone?Or do we want to reduce the waiting time for a medical test?)

Once that you know your goal, you can start your analyses like in a standard business case. Don't forget that even if you are not in a standard P&L case, you will probably have a budget for your project. This means that you have to consider what are the revenues and the costs in a specific time horizon, otherwise you don't know if your project is feasible or not.

The specific "public case" parts that you should consider to add to your standard framework are:

  • Potential partnerships with private companies
  • Public value of your project
  • Alternative solutions to address the same problem
  • Political landscape and public opinion

Hope it helps,
Luca

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Anny on Mar 02, 2020

Thank you so much! Appreciate your response

Vlad
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replied on Feb 27, 2020
McKinsey / Accenture Alum / Got all BIG3 offers / Harvard Business School

Hi,

These types of cases are actually pretty traditional, especially for McKinsey. The reason why people think that they are rare is that the casebooks (that are in general not a good source of cases) almost don't have them

Feel free to reach me if you need a prep on them.

The main things to keep in mind for the public sector and non-profits:

  1. Clarifying the objective - you should always have a measurable objective in mind, no matter whether it's public or private
  2. Build your structure basis objective and the context (e.g. for non-profits the value proposition will be important and Market probably not)
  3. Keep in mind non-core revenue streams (e.g. rental, restaurant, sub renting the collection, etc for a museum) and fundraising (mentor council, etc)
  4. Pay attention to implementation and communication parts (e.g. various stakeholders)

To provide a bit of structure, there are several types of non-profit cases:

  1. Factors influencing the price (What are the factors influencing the price of oil? Factors influencing the price of real estate?)
  2. Macroeconomic cases (How will you improve life expectancy in a particular city? How will you decrease the unemployment?)
  3. Public sector non-profits (Increasing the revenues of a museum; increasing the revenues from tourism in a city)
  4. Redesigning the processes (How will you develop a new anti-monopoly regulation?)
  5. Non-profit investments (A billionaire is building a new school. What are the factors to look at?)
  6. Ops and cost-cutting (How to reduce the traffic jams on a bridge? A garbage processing facility is out of capacity, what should they do?) - I personally consider them as a separate type of cases that is pretty traditional in the offices performing a lot of ops projects.

Best

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Anny on Mar 02, 2020

Thank you so much Vlad! Appreciate your response

Antonello
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replied on Feb 29, 2020
McKinsey | MBA professor for consulting interviews

Hi An, in case you need additional cases to practice with feel free to text me

Best,
Antonello

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Ian gave the best answer

Ian

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