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Framework for brainstorming ideas for cutting department costs (IT and Marketing)

cost structure costs profitability analysis
Most recent answer on Aug 08, 2023
The best answer (on Aug 05, 2023) is from:
Ian
Expert
#1 BCG coach | MBB | Tier 2 | Digital, Tech, Platinion | 100% personal success rate (8/8) | 95% candidate success rate
Ian
Expert
gave the best answer on Aug 05, 2023
#1 BCG coach | MBB | Tier 2 | Digital, Tech, Platinion | 100% personal success rate (8/8) | 95% candidate success rate
Hi Emma, Wherever possible try to avoid fixed and variable costs - interviewers want to shoot themselves when they hear this! Option 1: People IT/Tech/Systems NOT Process (doesn't apply here…it's linked with systems) == ... (read entire answer)
4
Answers
471
Views
25
Total Upvotes
on Aug 08, 2023 on Aug 08, 2023
Last Activity

Where and how to include Initial investment costs in (cost or profit comparison)

cost structure
Most recent answer on Feb 01, 2022
The best answer (on Feb 01, 2022) is from:
Pedro
Expert
30% off in March 2024 | Bain | EY-Parthenon | Roland Berger | Market Sizing | DARDEN MBA
Pedro
Expert
gave the best answer on Feb 01, 2022
30% off in March 2024 | Bain | EY-Parthenon | Roland Berger | Market Sizing | DARDEN MBA
In the first case, you are calculating annual costs. So you take the initial investment and turn it into an yearly cost dividing it by the expected useful life of the asset.In the second case, you are comparing the tota ... (read entire answer)
2
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1.7 k
Views
29
Total Upvotes
on Feb 01, 2022 on Feb 01, 2022
Last Activity

Cost structure: should I always use fixed cost vs. variable cost?

cost structure
Most recent answer on Jan 31, 2022
The best answer (on Oct 17, 2021) is from:
Pedro
Expert
30% off in March 2024 | Bain | EY-Parthenon | Roland Berger | Market Sizing | DARDEN MBA
Pedro
Expert
gave the best answer on Oct 17, 2021
30% off in March 2024 | Bain | EY-Parthenon | Roland Berger | Market Sizing | DARDEN MBA
You have to use a breakdown that makes sense for the specific problem. The problem with “fixed vs. variable cost” is that unless you dealing with a scale problem, it is usually meaningless/confusing. You are right, what ... (read entire answer)
7
Answers
1.2 k
Views
32
Total Upvotes
on Jan 31, 2022 on Jan 31, 2022
Last Activity

Cost Reduction - Structure

approaching a case Cost reduction cost structure cost-benefit analysis MBB Cost Structure profitability cost reduction Structure
Most recent answer on Jan 15, 2021
The best answer (on Jan 15, 2021) is from:
Ian
Expert
#1 BCG coach | MBB | Tier 2 | Digital, Tech, Platinion | 100% personal success rate (8/8) | 95% candidate success rate
Ian
Expert
gave the best answer on Jan 15, 2021
#1 BCG coach | MBB | Tier 2 | Digital, Tech, Platinion | 100% personal success rate (8/8) | 95% candidate success rate
Hi Ish, In general, for determining cost issues, you need to break down the problem into a tree/root-cause analysis and ask the highest level (but specific) questions first! In this way, you essentially move down the ... (read entire answer)
3
Answers
1.9 k
Views
44
Total Upvotes
on Jan 15, 2021 on Jan 15, 2021
Last Activity

Direct and Indirect ..instead of fixed and variable

cost structure
Most recent answer on May 04, 2020
The best answer (on Mar 05, 2020) is from:
Sidi
Expert
McKinsey Senior EM & BCG Consultant | Interviewer at McK & BCG for 7 years | Coached 350+ candidates secure MBB offers
Sidi
Expert
gave the best answer on Mar 05, 2020
McKinsey Senior EM & BCG Consultant | Interviewer at McK & BCG for 7 years | Coached 350+ candidates secure MBB offers
Hi! You should not limit yourself while structuring! Instead of just regurgitating "I want to split into fixed and variable cost" (no seasoned consultant would do this with a client!!) , you should discuss in a more m ... (read entire answer)
8
Answers
2.9 k
Views
15
Total Upvotes
on May 04, 2020 on May 04, 2020
Last Activity

When should I break down costs as Fixed and Variable as opposed to over the value chain?

Bain & Company BCG Case Interview caseinterview cost structure costs MBB McKinsey
Most recent answer on Feb 29, 2020
The best answer (on Feb 11, 2020) is from:
Ian
Expert
#1 BCG coach | MBB | Tier 2 | Digital, Tech, Platinion | 100% personal success rate (8/8) | 95% candidate success rate
Ian
Expert
gave the best answer on Feb 11, 2020
#1 BCG coach | MBB | Tier 2 | Digital, Tech, Platinion | 100% personal success rate (8/8) | 95% candidate success rate
It's not necessarily an and/or. When thinking about FC and VC you should also be thinking about the value chain. For example:Raw Mats (VC) and R&D (FC) are at the beginning of the chain. Labour (FC or VC), electri ... (read entire answer)
8
Answers
3.4 k
Views
8
Total Upvotes
on Feb 29, 2020 on Feb 29, 2020
Last Activity

In Profitability cases, when analyzing the cost side, how to decide the cost structure breakup?

cost structure Profitability Case Cost Structure profitability cost reduction
Most recent answer on Oct 02, 2019
The best answer (on Oct 02, 2019) is from:
Daniel
Expert
McKinsey / ex-Interviewer at McKinsey / I will coach you to rock those interviews
Daniel
Expert
gave the best answer on Oct 02, 2019
McKinsey / ex-Interviewer at McKinsey / I will coach you to rock those interviews
In my experience as an interviewer most of the time it doesn’t matter how you will divide the costs. What matters is breadth and depth of how you approach the problem. What do I mean by that? Let’s take an example of ... (read entire answer)
2
Answers
2.5 k
Views
14
Total Upvotes
on Oct 02, 2019 on Oct 02, 2019
Last Activity

Cost analysis

cost structure
Recent activity on Apr 14, 2019
The best answer (on Apr 14, 2019) is from:
Sidi
Expert
McKinsey Senior EM & BCG Consultant | Interviewer at McK & BCG for 7 years | Coached 350+ candidates secure MBB offers
Sidi
Expert
gave the best answer on Apr 14, 2019
McKinsey Senior EM & BCG Consultant | Interviewer at McK & BCG for 7 years | Coached 350+ candidates secure MBB offers
You have to look at both! Depending on the context, most strategic problems require investments (Capex) which need to be recouped by operational profits (Revenue - Opex). The Operational Costs (Opex) then can be disaggr ... (read entire answer)
2
Answers
2.1 k
Views
3
Total Upvotes
on Apr 14, 2019 on Apr 14, 2019
Last Activity

Insurance: cost & revenue drivers + general knowledge

cost structure Insurance Case
Recent activity on Mar 17, 2019
The best answer (on Mar 17, 2019) is from:
Vlad
Expert
McKinsey / Accenture Alum / Got all BIG3 offers / Harvard Business School
Vlad
Expert
gave the best answer on Mar 17, 2019
McKinsey / Accenture Alum / Got all BIG3 offers / Harvard Business School
Hi, Pls download several annual reports of the top insurance companies. You'll find all the required information there and even more. Best
1
Answer
2.7 k
Views
1
Total Upvotes
on Mar 17, 2019 on Mar 17, 2019
Last Activity

Structure of costs in profitability cases: OPEX & CAPEX vs Fixed costs and variable costs

cost structure costs
Recent activity on Oct 09, 2018
The best answer (on Oct 09, 2018) is from:
Dennis
Dennis gave the best answer on Oct 09, 2018
Here is my take: The case you are referring to is a question on whether or not to invest; so it's not a pure profitability problem. You want to analyse whether it is good to switch to Smart Meters so your strategy sho ... (read entire answer)
2
Answers
8.8 k
Views
3
Total Upvotes
on Oct 09, 2018 on Oct 09, 2018
Last Activity

Any tips when drawing a P&L and cost structure?

cost structure growth P&L profitability
Recent activity on May 23, 2018
The best answer (on May 23, 2018) is from:
Francesco
Expert
#1 Coach for Sessions (4.000+) | 1.500+ 5-Star Reviews | Proven Success (➡ InterviewOffers.com) | Ex BCG | 10Y+ Coaching
Francesco
Expert
gave the best answer on May 23, 2018
#1 Coach for Sessions (4.000+) | 1.500+ 5-Star Reviews | Proven Success (➡ InterviewOffers.com) | Ex BCG | 10Y+ Coaching
Hi Gerard, I have answered below to your questions: 1) To identify P&L, you should identify revenues and costs of the company. Moreover, from what you mentioned it seems you should also estimate the size of the ... (read entire answer)
2
Answers
3.5 k
Views
10
Total Upvotes
on May 23, 2018 on May 23, 2018
Last Activity
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Consulting Q&A – Ask Questions about Your Career

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