Should you state a hypothesis before drawing a structure tree as recommended by Victor Cheng?

Hi there,

This is indeed an interesting question which is probably relevant for quite a lot of users, so I am happy to provide my perspective on it:

• It really depends on the information given to you, your general knowledge about the specific industry and the type of case study.
• Generally speaking, I would advise you to state a hypothesis you feel confident with. For instance, with an M&A case study, it might most probably not make sense to state the hypothesis that the company should do the acquisition before having conducted any analysis. However, you could state the hypothesis that the decsion will be mainly driven by, e.g., the potential (revenue) synergies as otherwise the target does not seem to be that attractive at first sight.
• However, if you do not feel confident about stating a hypothesis at all or if the situation does not allow it, do not make yourself crazy about it. Several of my coachees still got their offers despite not stating a hypothesis in every single case interview for the above stated reasons.

In case you want a more detailed discussion on how to best formulate your hypotheses and solve any type of case study, please feel free to contact me directly.

I hope this helps,

Hagen

Honestly, the hypothesis-led approach is outdated.

Rather, you need to have a hypothesES-driven or, rather, and objective-driven approach. Your entire framework is a set of hypotheses and views as to how to solve a problem.

In my view, the more natural the better. I tend to say things like "My thinking here is x". or "Based on what I know about x and y, I think this'll likely happen" or "My inclination is x".

Please get away from saying any generic, i.e. hypothesis, framework, buckets, clarifying questions, etc.!

This Q&A Describes Better Hypothesis Thinking

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

Your instinct to wait until you get further informaiton is correct. However, remember that your framework is essentially a set of hypotheses. That's why I prefer to call this "hypotheses-drive approach" or "objective-driven approach"

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 2 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

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

Hello,

You can, but you don't have to. I think Victor Cheng's suggestion of offering a hypothesis is to put you in a good starting position to drive the case - you have something to test. However, you can do just as well progressing systematically through the issue tree and offering good justification for the order in which you go down it without having an explicit hypothesis. 

Moreover, it is easier to form a starting hypothesis in some cases than in others - in some cases you will have a little hint or a hunch from the prompt already, whereas others will seem much more open. In the latter scenario, offering up a random hypothesis with little justification won't do much for you (e.g. in a profitability case, saying you think the issue has to do with costs if you've been given no indication of this seems random - it could be revenues or market trend with equal likelihood), though you can frame it as part of your process if you find it helpful (e.g. "first I would like to test if costs are the issue here" - this is an implicit hypothesis).

So overall I would say it is up to you and your casing style, both approaches can work. 

Yes. 

I did that in my interview and I've had multiple coachees that went on to get offers do that. It's important to show that you have direction, that you have a hunch, even with only preliminary data. It's also important to underline that it's only a hypothesis, that starting from it you are now about to go through a structured methodology and prove or disprove the hypothesis.

However, if you don't have a hypothesis and nothing good comes to your mind, rather skip it. Don't force it and say something that is obviously wrong just to tick the box.

• If you have a hypothesis in mind, yes, please state it. The issue tree should directly test the hypothesis
• If you don't have a hypothesis in mind, don't force yourself to make up one for the sake of having one. You risk doing damage by stating that sounds completely wrong

yes!