How to be "hypothesis driven"? What does is really mean?

Question

I am not clear about how to be "hypothesis driven". In ideal scenario, a candidate should draw out issue trees, list key hypothesis ->test hypothes ->revise hypothesis. In real interview, is it possible to really make the whole case "hypothesis driven" and streamlined?

I've seen several ways of using hypothesis. Example one: key hypothesis that the client should enter Middle East's coffee market is that the market is attractive. To test the market's attractiveness, I need to look into several areas. First, market growth... Second, customer preference....etc. The above example to me sounds more "hypothesis driven".

Example two: state hypothesis of each branches of the issue tree. For instance: should high end European hair product manufacturer enter Asia market? One hypothesis (among many) is that our client is able to make a product that suits Asian customer's preference. I'm confused by this method. Although I may be mentioning many hypothesis when I mention each issue tree branch, I'm not using hypothesis to guide the "flow". I'm sharing hypothesis of many different topics.

Could you please share what would be the best way to use hypothesis in the case? Ideally, the way consultants would use hypothesis in every day life.

Thank you!

Answer 1

Hi there,

While I do highly recommend you get coaching for this (your question is essentially asking "How do I solve a case well"), I can provide some initial guidance here.

Hypothesis-driven - We are no longer singular hypothesis-driven, stating this boldly at the beginning of the case. Rather, we are hypotheses-driven or objective-driven. This is very different.

Your entire framework is a set of hypotheses and views as to how to solve a problem.

You don't need to state it explicitly, but remember that 1) You need to always be thinking about one and 2) You need to be demonstrating your drive towards one.

Also, remember that a hypothesis isn't necessarily "I believe x is the cause". Be better hypothesis is "If we can see what's happening with A, and A is going up, and then we look into B and B is big, then x is likely the case".

A hypothesis is much more about what questions do I need to ask/answer and how, in order to see what's happening.

Another way of viewing it:

Your framework is your structure for approaching the problem. It consits of a few main areas you'd like to look at. Inherent in your framework is a view that "If I answer A, B, and C, then we have an answer"

So, for market entry:

1) If the market is big, and it's growing, then we still want to considering entering

2) If #1 = yes, then let's see if it's attractive...can we win there? Is our product good/better than our competition's? Etc. If yes, let's definitely consider entering.

3) If #1 and #2 = yes, then, when we do enter, are we sure we can win? I.e. do we have the right plans. Will implementation actually pan out? Do we have the expertise, capital, etc.? In other words, if #2 is the thearectical, #3 is the reality.

Then, your summary becomes "I believe we should enter the market, if we can prove it's a good market, the it's attractive to us specifically, and that we will win it".

^Now this is a hypothesis :)

Read these 4 Q&As for some great context + discussion:

https://www.preplounge.com/en/consulting-forum/interviewer-led-case-interview-hyposthesis-and-ideas-7390

https://www.preplounge.com/en/consulting-forum/forming-a-hypothesis-case-in-point-vs-victor-cheng-7311

https://www.preplounge.com/en/consulting-forum/what-about-victor-chengs-loms-and-case-interview-secrets-book-are-outdated-9846

https://www.preplounge.com/en/consulting-forum/at-what-point-in-the-case-does-the-interviewee-state-hypothesis-9356

Hope this helps! This is a tricky topic that's difficult to properly answer in writting...if you want a more thorough explanation, and training in the mindset shift required here, don't hesitate to reach out!

Answer 2

Hypothesis driven effectively means having a answer-driven approach. When you do a profitability case, your hypothesis is that 'it could be a revenue or a cost problem - either the revenues are declining, or the costs are increasing'. When you further analyse revenues, your hypothesis is that 'Either my price is declining/stagnant, or i am unable to see sufficient volumes'.

You are effectively making a hypothesis to move forward in a case and drive the discusssion. Dont worry about it - i am fairly certain you have been doing this all along, while doing your case preparation. Feel free to reach out for further support.

Answer 3

Hello!

Being hypothesis driven is that, by leveraging data, you have an idea/some ideas of where the solution may be, and you do your questions, comments and inquiries in the case to try to proof that one valid/wrong.

However, carefull here, since this does not mean that you need to start every case with a "I believe the solution is this", since many times this is actually impossible to know until problem solving

Hope it helps!

Cheers,

Clara

Answer 4

Hi, I would only add this insightful answer to the discussion https://www.preplounge.com/en/consulting-forum/how-explicitly-do-you-need-to-state-your-hypothesis-in-mck-cases-1526

Best,
Antonello