Hi Anonymous,

in addition to the previous points, I think it would also be useful to practice how to gain more time initially, in case you are not sure about the structure to apply. In order to do so, the most useful thing would be to recap all the information you received until that moment. This will give you time without giving the impression you don’t know where to go, and also help you to sound more structured. After that, you could move to the points mentioned by Vlad and Ingnacio, (i) asking for one minute of time to structure your thoughts (which, to answer your last question, is ok to ask), (ii) identifying the key pillars of your structure and then (ii) brainstorming for each of them appropriate elements.

I have reported below an example from a previous post that I wrote.

---

Interviewer: So, generally speaking, how would you decrease the cost of raw materials?

Step 1: Recap the situation and ask for time to think

Interviewee: So, if I got it right, you would like now to move to the elements that could decrease this cost. If it is fine for you, I would like to do a small recap and then move through the key elements that can help to do so. At the beginning you asked me what brought a decline in profits. We have identified the problem lays in Product A, and in particular in the cost area. We then found out that the main increase in cost was related to raw material.

Interviewer: That’s right.

(Notice you may have gained 30 seconds of additional time summing up information)

Interviewee: Do you mind if I take 1 minute to think about it?

Interviewer: Please take your time.

Step 2: Present the key pillars of the structure

Interviewee: Thanks; I believe there are two key areas to decrease the cost of raw material; we may decrease the cost of each unit, or we may decrease the number of units we buy. I would like now to go a bit deeper in these two components.

(Notice that even if you are brainstorming, you are first putting down a list of the MECE pillars of a structure. This is fundamental to brainstorm correctly)

Step 3: Brainstorm elements inside each pillar

Interviewee: Well, in order to decrease the cost per unit we may do a couple of things, keeping in mind we want to maintain revenues at the same level:

1. number one, decrease the quality of the units that we use;
2. number two, negotiate with the supplier;
3. number three, find another supplier.

In order to decrease the number of units, we may do two things:

1. we may implement a more efficient method to use them, so that we would have to buy fewer of them.
2. We may also substitute some of the units with something else that may be cheaper and with the same effect on the final product.

---

Hope this helps,

Francesco

(edited)

Hi Anonymous,

you do not necessarily need to be able to cover all the industries to improve brainstorming; rather, it could actually be better to learn very well how to do the following three things:

1) Clarify the goal you have to achieve

2) Clarify information on the industry when you are not familiar with it

3) Learn to be structured in a MECE way

This could lead you more easily to the right solution then a deep knowledge of industries.

Taking your example, let’s say that indeed you are not familiar with the banking industry, and you get a question on making credit card successful. You could proceed as follows:

1. Clarify the goal: What does it mean successful? Do we want to achieve a specific amount of revenues/profits? If so, how much? (Let’s assume the goal is to increase profits by 1 million)
2. Clarify information on the industry: As I am not familiar with the industry, I can make the hypothesis that source of revenues could be [ELEMENT 1] or [ELEMENT 2], and source of cost [ELEMENT 3] or [ELEMENT 4]; do we have any information if there are additional sources of revenues and costs?
3. Be structured in a MECE way: In order to maximize revenues we could work on increasing the price or the volume offered. Given what you told me in addition to the elements I listed, I would say that in order to increase the price we could do [OPTION 1] or [OPTION 2]. To increase volume we could do [OPTION 3]. On the other hand, if we want to decrease the cost, we could either decrease the cost per unit or the number of units. From the information you provided, I would say we could do [OPTION 4] or [OPTION 5].

In addition to practising the previous three steps in cases where you are not familiar with the industry, I would suggest to read cases for MBA consulting handbooks (many of them are freely available online – I would suggest to read at least 80 cases) to develop the ability to know better the main industries (in this way, you could feel the ELEMENT and OPTION slots above); that should be done with the goal of making brainstorming easier, not to have a full knowledge of every industry, since that would neither be expected o necessary to successfully land an offer. Carlos, Vlad and Nuno have also discussed the topic at the following link:

https://www.preplounge.com/en/consulting-forum/how-could-i-improve-my-business-acumen-for-interviews-701

Hope this helps,

Francesco

Hi Anonymous,

I would recommend the following steps to improve your creativity:

1. Recap the situation until that moment
2. Ask for one minute of time to structure your thoughts
3. Identify some key MECE areas. Potential division includes: Number of units - Price per unit (eg to identify the components to reduce costs); Current-New (eg to structure product, customers, distribution channels); Financial-Non financial (eg to compare ways to enter a market)
4. Brainstorm inside each of the areas. Your creativity in this area is directly correlated with the number of cases you have done. If you feel weak in one specific industry, the most efficient strategy is to go though consulting MBA handbooks (there are many available for free online) and screen the list for the industries interesting for you.

I provided an example below.

---

Interviewer: So, generally speaking, how would you decrease the cost of raw materials?

Step 1: Recap the situation

Interviewee: So, if I understood correctly, you would like now to move to the elements that could decrease this cost. If it is fine for you, I would like to do a small recap and then move through the key elements that can help to do so. At the beginning you asked me what brought a decline in profits. We have identified the problem lays in Product A, and in particular in the cost area. We then found out that the main increase in cost was related to raw material.

Interviewer: That’s right.

(Notice you may have gained 30 seconds of additional time summing up information)

Step 2: Ask for one minute of time to structure your thoughts

Interviewee: Do you mind if I take 1 minute to think about it?

Interviewer: Please take your time.

Step 3: Identify some key MECE areas

Interviewee: Thanks; I believe there are two key areas to decrease the cost of raw material; we may decrease the cost of each unit, or we may decrease the number of units we buy. I would like now to go a bit deeper in these two components.

(Notice that even if you are brainstorming, you are first presenting a list of the MECE areas. This is fundamental to brainstorm correctly)

Step 4: Brainstorm inside each of the areas

Interviewee: Well, in order to decrease the cost per unit we may do a couple of things, keeping in mind we want to maintain revenues at the same level:

1. we may use lower quality material;
2. we may negotiate with the supplier;
3. we may look for someone else as supplier.

In order to decrease the number of units, we may do two things:

1. we may start to use a more efficient technology for our raw material, so that we have to buy fewer units;
2. we may also substitute some of the units with other type of materials, ideally cheaper.

---

Hope this helps,

Francesco

1) Ask an interview for a minute to think

2) Think of several buckets of ideas (e.g. organic growth / non-organic growth / differentiation). Remember to think as big as possible

3) Narrow down to each bucket and generate as much ideas as possible

4) Present the structure (buckets) and then your ideas

Creativity is in direct correlation with you business judjement that can be trained by solving more various cases with partner / studying various frameworks / reading industry reports / reading HBS cases (google them)

Hi!

Probably you did not answer the question on creativity properly (e.g. could you think of 10 possible ways of increasing the revenue?)

Several tips here:

1) Always ask an interview for a minute to think

2) Think of several buckets of ideas (e.g. organic growth / non-organic growth / differentiation). Remember to think as big as possible

3) Narrow down to each bucket and generate as many ideas as possible within each bucket

4) Present the structure (buckets) and then your ideas

Creativity is in direct correlation with your business judgment. Business judgment is directly related to industry knowledge. Focus on the most common industries in the following priority (sorted by probability of getting a case): 1-retail and CPG; 2-airlines; 3-Telecom; 4-banking; 5-natural resources; 6-tech

There are several sources of information to develop industry knowledge:

1) Cases - you simply solve 50-70 cases and get a broad knowledge of different industries, common pitfalls and questions. The key here - find good partners who already had case interviews with MBB companies

2) Company reports, equity reports, IB roadshow docs - usually have a good overview of company and industries. Annual company reports are probably the best source of information about the industry

3) HBS cases - quite useful, but not sure if lot's of them available publically. Probably worth buying

4) Books - one good book about airlines with numbers and industry analysis can give you all needed industry knowledge

5) News, Industry blogs

For each industry, you should understand:

• Revenue streams
• Cost structure
• Margins
• Key performance indicators
• Key revenue drivers
• Industry trends

Also some comments about particular industries:

1) Retail - make sure you understand key retail metrics (P&L lines, same store sales, revenue per square meter and per person, etc) and how distribution works as well as its metrics (share on shelf, etc)

2) Airlines - read about profitability issues, different routing models, cost structure, industry metric s like load factor and make sure you know all possible additional revenue streams

3) Telecom - I would read industry reports and try to understand how telecom is transforming with internet penetration and tech innovations

4) Banking - you should know the key products in corporate and retail banking and how they earn money (Interest, commision, transactional)

5) PE / M&A - go through available case examples and read about different PE strategies

Good luck!