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How would you approach a profitability and process improvement assessment?

operations strategy profitability
New answer on Jul 25, 2019
2 Answers
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Anonymous A asked on Jul 24, 2019

Is there a typical consulting approach to these kinds of assessments? I'm having a hard time structuring a MECE approach that looks at both profitability and operational processes. I used a profitability tree to determine whether to look into revenue or costs and then used the root cause there to narrow what processes I should look at. Is that logical?

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Alexander updated an answer on Jul 25, 2019

I agree with Vlad that knowing more about the case would be benefitial. However: Have you considered starting with a profitability tree and then splitting the costs not into fixed costs and variable costs, but into costs associated with the individual steps of the process you're supposed to optimize?

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Vlad
Expert
replied on Jul 24, 2019
McKinsey / Accenture Alum / Got all BIG3 offers / Harvard Business School

Hi,

Could you pls provide an example of the case?

If it's a profitability issue, how do you know in advance that you have a process problem? And if it's a process problem, why do you need profitability?

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