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How to state a hypothesis and match to the structure?

Carina

I am still pretty new to case interviews. I did prepare a lot of theory already, and now I am especially struggling with the relationship of hypothesis and framework.
Specifically, I worked on a case to increase market share. Now this can be done in several ways. Do I first outline a general structure (lets say focused around the company, the consumer and the competition) and then start with one random hypothesis, for example target a new consumer segment, then test this with the general structure but only the relevant aspects? In case the hypothesis proves wrong, I then pick a new and use the same structure?
Or do I first state a hypothesis build a structure to that, and build a new structure in case this hypothesis is wrong?

I hope you understand my issue and can help me :)

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Vlad replied on 01/08/2018
McKinsey / Accenture / Got all BIG3 offers / More than 300 real MBB cases / Harvard Business School

Hi,

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 hypothesis is 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!

(edited)

Francesco replied on 01/23/2018
Ex BCG | MBB Specialist | #1 Expert for coaching sessions (1400+) and recommendation rate (100%)

Hi Carina,

my suggestion would be to first outline the structure (first and second level), and explore each point to test if your hypothesis is correct (thus first option mentioned by Vlad). In this way you can be sure that if the interviewer wants you to go in another direction, he/she can do so. If you base your structure on the various hypotheses, your overall plan will not sound as structured (by definition you will not have presented all the second levels) and the interviewer may not understand the whole process you have in mind.

Hope this helps,

Francesco

Currently non-active expert
Expert
replied on 01/08/2018

Hey Carina,

You should start by drafting a MECE (mutually exclusive, complementary exhaustive) structure/framework to approach the case (e.g., the one you reffered about evaluating different dimensions of the company) and then ask the interviewer whether he has any comments or preferences on where to start. If he doesn't, you should start where you feel that it is the most important point and start evaluating/analyzing that hypothesis... finish that analysis, and move to the next branch... and so on!

Best

Bruno

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