expert
Expert with best answer

Vlad

97% Recommendation Rate

388 Meetings

7,071 Q&A Upvotes

USD 299 / Coaching

1

How to be MECE in non-profitability cases

Dear all

I am currently practicing cases and have a question about MECE. I have read a lot of articles but am still not getting it completely. Whenever you have an issue problem: profitability, revenue decrease, how to grow your revenue etc. and the question is to find the source of the problem, it is completely logical for me that you have to split it up into P=R-C or similar to be 100% sure that you consider all the possible root-causes for a certain problem.

My problem arises when the questions are something like "Should Aldi enter the Chinese market?". How can you be sure that your approach is MECE there? How can you set up a structure that makes you 100% sure that you consider everything there is to consider (obviously 80/20 in mind)?

How would you structure your approach to solve the case above, and why would it be MECE?

Thanks for your help and best,

A

Dear all

I am currently practicing cases and have a question about MECE. I have read a lot of articles but am still not getting it completely. Whenever you have an issue problem: profitability, revenue decrease, how to grow your revenue etc. and the question is to find the source of the problem, it is completely logical for me that you have to split it up into P=R-C or similar to be 100% sure that you consider all the possible root-causes for a certain problem.

My problem arises when the questions are something like "Should Aldi enter the Chinese market?". How can you be sure that your approach is MECE there? How can you set up a structure that makes you 100% sure that you consider everything there is to consider (obviously 80/20 in mind)?

How would you structure your approach to solve the case above, and why would it be MECE?

Thanks for your help and best,

A

1 answer

  • Upvotes
  • Date ascending
  • Date descending
Best Answer
Book a coaching with Vlad

97% Recommendation Rate

388 Meetings

7,071 Q&A Upvotes

USD 299 / Coaching

Hi,

First of all - not all issue trees can and should be MECE. Very often it's not the case. For example, depending on the objective, the market entry case should not necessarily be MECE.

Secondly - there is a number of ways how you can approach in a MECE way:

  1. If your structure works mathematically (e.g. Total time spent on cleaning operation = # of people x Frequency x Hours per cleaning per person)
  2. If your structure comes from a formula (e.g. output rate = total number of people being served / time to serve one person)
  3. If you are using the common industry drivers (e.g. revenues = # of customers x av. check) (e.g Passengers on the plane = capacity x Load Factor) or the industry revenue streams (Fuel revenues / non-fuel revenues for the gas station) or the functional drivers (e.g. for the problems in sales : Sales strategy / sales peopleand allocation / motivation / sales process)
  4. If your issue tree is a real framework used by the consultants (e.g. the famous Bain Cap framework for PE due dills: Market / Competitors / Company / Feasibility of exit) (e.g. People / Process / Technology) (e.g. The famous McKinsey framework - People don't want to do smth / they can't do smth / smthprevents them from doing that)
  5. If your structure is a well-known academically MECE framework (e.g. Product / Distribution / Price / Marketing (Also known as 4P))

There is no magic pill how you can learn to build the MECE issue trees. !!!! It comes with a lot of Practice and reflection and building proper industry and functional knowledge. !!!!

Best

Hi,

First of all - not all issue trees can and should be MECE. Very often it's not the case. For example, depending on the objective, the market entry case should not necessarily be MECE.

Secondly - there is a number of ways how you can approach in a MECE way:

  1. If your structure works mathematically (e.g. Total time spent on cleaning operation = # of people x Frequency x Hours per cleaning per person)
  2. If your structure comes from a formula (e.g. output rate = total number of people being served / time to serve one person)
  3. If you are using the common industry drivers (e.g. revenues = # of customers x av. check) (e.g Passengers on the plane = capacity x Load Factor) or the industry revenue streams (Fuel revenues / non-fuel revenues for the gas station) or the functional drivers (e.g. for the problems in sales : Sales strategy / sales peopleand allocation / motivation / sales process)
  4. If your issue tree is a real framework used by the consultants (e.g. the famous Bain Cap framework for PE due dills: Market / Competitors / Company / Feasibility of exit) (e.g. People / Process / Technology) (e.g. The famous McKinsey framework - People don't want to do smth / they can't do smth / smthprevents them from doing that)
  5. If your structure is a well-known academically MECE framework (e.g. Product / Distribution / Price / Marketing (Also known as 4P))

There is no magic pill how you can learn to build the MECE issue trees. !!!! It comes with a lot of Practice and reflection and building proper industry and functional knowledge. !!!!

Best

Related BootCamp article(s)

Focusing on The Core: Mock Interviews

It is to practice as many cases as possible - both as interviewee and as interviewee. Here are a couple of guidelines to help you get started

Case Studies

The case study is the most important element of the case interview, which you'll have to nail in order to get into strategic consulting. Here you can learn the specific skills and concepts necessary to solve them.

MECE Principle

The MECE method is a way of segmenting data into sub-elements that are mutually exclusive & collectively exhaustive. Learn more now!

Quiz

The Value Chain

The Value Chain - as e.g. by Porter - is a classic framework to structure the activities of a business and add value to products by transforming resources.

Approaching a Case

In order to get into consulting, the case study is the most important element of the interview. Here, you can learn the specific skills and concepts to solve them.

1 Q&A

Related case(s)

Smart Education

Solved < 100 times
Smart Education Your client is SmartBridge, a nonprofit educational institution offering face-to-face tutoring services. The client operates in the US. The mission of SmartBridge is to help as many students as possible to complete studies and prevent that they drop from the school system, in particular in disadvantaged areas. The client is considering starting operations for its services in the Chicago area. They hired us to understand if that makes sense. Due to the nonprofit regulation, SmartBridge should operate on its own in the market, without any partnership. How would you help our client?
4.5 5 10
| Rating: (4.5 / 5.0)

Your client is SmartBridge, a nonprofit educational institution offering face-to-face tutoring services. The client operates in the US. The mission of SmartBridge is to help as many students as possible to complete studies and prevent that they drop from the school system, in particular in disadvan ... Open whole case