Structure Risks and Opportunities

Hi Anonymous,

in general I would suggest the following steps to assess risk and opportunities: (i) go back to the objective of the case, (ii) identify the elements that would influence such objective in a MECE way and (iii) see how decision xy could influence them. As an example, if you are considering launching a new product where your goal is to maximize profits and the question is about risk and opportunities of a marketing campaign, you could proceed as follows:

1. Go back to the objective. In this case you have to maximize profits
2. Identify the key elements that will influence your objective. In this case is revenues and costs. Then identify the second layer that could influence such objective. In this case is price, volume, fixed and variable costs
3. Think how a marketing campaign could influence these elements. Eg, after a marketing campaign, you may charge a premium price for your product, however that could also imply a fixed cost not repaid in case the campaign is not successful.

Hope this helps,

Francesco