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Structure weird cases

How do I structure "weird" cases (e.g. should I buy or rent a house at the beach?)?

How do I structure "weird" cases (e.g. should I buy or rent a house at the beach?)?

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Hi there,

Always think in terms of a hypothesis: if X, Y, and Z were true, then yes I'll do this thing. Or not. Structure this like an equation. Benefits X and Y minus cost Z = positive or negative?

So for a beach house, what would need to be true for it to be a good idea? As a next level, think in terms of quant vs. qualitative factors. Quant is the price of the house itself, the cost of upkeep, some risk-free rate of return (the foregone income from buying the thing) the cost of substitutes (ie other vacations), the time it takes to get there, and the number of months a year you can use it.

Qualitative is other benefits or costs you're getting from this. Benefits are more frequent vacations, maybe your kids can learn to swim. Cost is that your beach house is now your only vacation, as you'll feel obligated to go there, rather than doing something different every time.

Attempt to quantify all of this, and if it's positive, it's a go. If not, then not.

The additional benefit of "weird" problems is that you can interact with your interviewer more. If they're asking about buying a beach house, then maybe they personally are getting one. That's a fun thing to talk about. It should be collaberative, so don't get too thrown by these.

Happy to discuss more if you want to send a message,

Bryan

Hi there,

Always think in terms of a hypothesis: if X, Y, and Z were true, then yes I'll do this thing. Or not. Structure this like an equation. Benefits X and Y minus cost Z = positive or negative?

So for a beach house, what would need to be true for it to be a good idea? As a next level, think in terms of quant vs. qualitative factors. Quant is the price of the house itself, the cost of upkeep, some risk-free rate of return (the foregone income from buying the thing) the cost of substitutes (ie other vacations), the time it takes to get there, and the number of months a year you can use it.

Qualitative is other benefits or costs you're getting from this. Benefits are more frequent vacations, maybe your kids can learn to swim. Cost is that your beach house is now your only vacation, as you'll feel obligated to go there, rather than doing something different every time.

Attempt to quantify all of this, and if it's positive, it's a go. If not, then not.

The additional benefit of "weird" problems is that you can interact with your interviewer more. If they're asking about buying a beach house, then maybe they personally are getting one. That's a fun thing to talk about. It should be collaberative, so don't get too thrown by these.

Happy to discuss more if you want to send a message,

Bryan

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Hello,

You have always to look at a "weird" case abstracting the situation and trying to see it like a standard case. In your example, you can see the rent and the acquisition of an house as 2 different investments with 2 different DCF.

Best,
Luca

Hello,

You have always to look at a "weird" case abstracting the situation and trying to see it like a standard case. In your example, you can see the rent and the acquisition of an house as 2 different investments with 2 different DCF.

Best,
Luca

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Hello!

I guess what you mean with "werid" cases are all those that don´t have a tag (e.g., profitability, market entry, pricing, etc.) These are actually the most usual ones in 2nd round, for which is good to have practice a lot and be able to structure then with ad-hoc structures -that vary from case to case-.

Cheers,

Clara

Hello!

I guess what you mean with "werid" cases are all those that don´t have a tag (e.g., profitability, market entry, pricing, etc.) These are actually the most usual ones in 2nd round, for which is good to have practice a lot and be able to structure then with ad-hoc structures -that vary from case to case-.

Cheers,

Clara

Awesome! Thanks for your reply, Clara. Is there any resource where I can practice this? — Anonymous A on Feb 17, 2020

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There is noting "weird" in such a question. It is a very clear and almost classical problem that you encounter all the time in business or personal life. Buying an asset, or renting/leasing it. This can be structured just like any other strategic question - via a top down logic. You just need to clarify what the objective is (probably financial benefit). Then you structure accordingly:

Comparing the cash flows of both options, followed by a consideration of non-financial pros and cons for each option. That's it.

Cheers, Sidi

There is noting "weird" in such a question. It is a very clear and almost classical problem that you encounter all the time in business or personal life. Buying an asset, or renting/leasing it. This can be structured just like any other strategic question - via a top down logic. You just need to clarify what the objective is (probably financial benefit). Then you structure accordingly:

Comparing the cash flows of both options, followed by a consideration of non-financial pros and cons for each option. That's it.

Cheers, Sidi

(edited)

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Hi Anonymous,

There is no single way to structure more abstract cases. Rather, you should learn to harness and structure your own, natural thought/problem solving process clearly and effectively. Even when it comes to standard cases, I like to coach this method as opposed to teaching frameworks as you will be far better prepared for any case thrown at you in an interview. The cases I had to solve in my OW interviews were on the more abstract side - it is a really good way to test problem solving skills.

Happy to chat further or help you practice - feel free to send me a message.

Best,

Jessica

Hi Anonymous,

There is no single way to structure more abstract cases. Rather, you should learn to harness and structure your own, natural thought/problem solving process clearly and effectively. Even when it comes to standard cases, I like to coach this method as opposed to teaching frameworks as you will be far better prepared for any case thrown at you in an interview. The cases I had to solve in my OW interviews were on the more abstract side - it is a really good way to test problem solving skills.

Happy to chat further or help you practice - feel free to send me a message.

Best,

Jessica

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If it's about taking a decision between 2+ scenarios, identify pros and cons of each scenario or the main KPI to evaluate it and assign a weight to each of them with a structured table,

Best,
Antonello

If it's about taking a decision between 2+ scenarios, identify pros and cons of each scenario or the main KPI to evaluate it and assign a weight to each of them with a structured table,

Best,
Antonello

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For "weird" cases, i.e. any context you're not familiar with (i.e. this will be most...that's the point!), think about what you're learned that you can apply.

If you replace this sentence with "buy or lease factory land", are you more comfortable with the question?

The only change is the "industry" or context, not the case type...apply the context to frameworks you already know!

For "weird" cases, i.e. any context you're not familiar with (i.e. this will be most...that's the point!), think about what you're learned that you can apply.

If you replace this sentence with "buy or lease factory land", are you more comfortable with the question?

The only change is the "industry" or context, not the case type...apply the context to frameworks you already know!

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Hi,

It's a classic case of comparing the two options and their NPV. No weirdness here.

Best

Hi,

It's a classic case of comparing the two options and their NPV. No weirdness here.

Best