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What will be more appreciated? Comprehensive or key factors with strong logic support?

Yibing asked on Oct 29, 2018 - 2 answers

Hi all,

When preparing the interviewer-led interview, some tactics for answering the question "what will the factors you consider" really confused me...

  1. Is it necessary to state a hypothesis before lay out the structure?
    • if yes, I found some type of question really hard to make a hypothesis, e.g. Client is wondering how to increase sales / The hospital want to know how to improve
  2. ‚ÄčWhen layout the structure, which one would preferred?
    • Comprehensive structure - say try list all possible areas of a problem as the 1st layer of my issue tree, and under each branch, mention as many factors as possible to be comprehensive.
      • If this one is preferred, how can I prove that certain point (which could probably be layed out just to show that I know this point!) is relevant in this specific case?
    • Structure with only key factors(in 2nd layer) - this would be kinds of similar to the comprehensive structure in the 1st layer, but under each branch, will only mention maybe 2-3 subfactors which is highly related to my hypothesis.
  3. Timing of thinking and talking - Is it fine to have 1.5-2 min to think through? In general how long should I talk for my structure?
    • I know a lot super strong candidate can grasp their idea quite fast, how they do that?? Except pratice*3, is there any secret tip could be shared>_<?

Thanks a ton!!! //bow

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Vlad replied on Oct 29, 2018
McKinsey / Accenture / Got all BIG3 offers / More than 300 real MBB cases / Harvard Business School

Hi,

First of all the structure is exactly the same as with the candidate-led case. It's not important who leads the case if you can solve cases.

Answering your questions:

1. Is it necessary to state a hypothesis before lay out the structure?

The major mistake of the candidates is that they start using the hypothesis and neglect having a proper structure.

Moreover, if you perfectly solve the case without ever stating a hypothesis - you'll pass the interview. So most probably you had some other issues with the case as well and they used it as a standard feedback.

There are two ways to use the hypothesis:

First - presenting a structure using the hypothesis. For example, if you are having a PE (private equity) case, you should do the following:

1) Make classic structure (market, company, competitors, feasibility of exit)

2) Make subpoints (e.g. in market: size, growth rates, profitability, segmentation, etc)

3) Present your 1st level Hypothesis:

  • - "In order to understand whether we should invest in Company A, I would like to check a number of the hypotheses - that the Market is Attractive, the Company is Attractive, the competition is favorable and we have good opportunities for of exit"

4) Present the main 2nd level Hypothesis:

  • "In the market, I would like to make sure that the market is big enough and growing;
  • In the company I would like to find additional opportunities for growth;
  • In competition I would like to check that the market is fragmented enough;
  • Finally, I would like to check if we have potential buyers and can achieve desired exit multiples"

Another way to use hypothesis is using the hypothesis to prioritize your analysis:

1) Make a structure: "Problem in sales may be related to Sales Motivation, Sales Strategy, Sales Coverage, and Sales Process:

2) Prioritize a part of the structure based on your knowledge / common sense / available data: "Taking into account that motivation is the core problem of the sales organization, I would like to prioritize this part of the analysis".

2. When layout the structure, which one would preferred?

  • In some cases, you'll be able to build a fully MECE structure (e.g. Profitability, Value chain). Usually, you go 2-3 levels deep in your structure in the beginning of the case.
  • In other cases, you should be using a broader structure. For example, in a private equity / due diligence case your structure can be: Market, Company, Competitors, Feasibility of exit. For the 2nd layer, you make subpoints (e.g. in the Market you put: size, growth rate, profitability, segmentation, regulation, etc). I usually use a bullet point list under each bucket.

3. Timing of thinking and talking - Is it fine to have 1.5-2 min to think through? In general how long should I talk for my structure?

It takes 1.5-2 min. The key time-consuming mistake here is to start providing the examples or explaining why you are looking for the certain factors. If you have 4 branches with 5-6 bullets each and you start explaining each bullet point - imagine how time-consuming it can be.

When you are done - rotate the paper with a structure to the interviewer

1) Present your 1st level Hypothesis:

  • - "In order to understand whether we should invest in Company A, I would like to check that the Market is Attractive, the Company is Attractive, the competition is favorable and we have good opportunities for of exit"

2) Present the key 2nd level Hypothesis:

  • "In the market, I would like to make sure that the market is big enough and growing;
  • In the company I would like to find additional opportunities for growth;
  • In competition I would like to check that the market is fragmented enough;
  • Finally, I would like to check if we have potential buyers and can achieve desired exit multiples"

3) Make sure that the interviewer can see that you are presenting selectively and that the actual list of bullet points you would like to check is actually longer.

!!!Alternatively, if the interviewer is interested in all factors, you can present all the bullet points that you have. It will not take much longer!!!

Best

Guennael replied on Oct 29, 2018
Ex-MBB, Experienced Hire; I will teach you not only the how, but also the why of case interviews

1. No, you do not have to have a hypothesis before the structure; technically, you do not have a state a hypothesis either, although that would be best practice. A hypothesis will help you understand what you need to work on, and your interviewer understand where you are going

2. Structure wise, your framework needs to be MECE; you should definitely feel comfortable bringing the most likley areas first however: a case is very quick, and you will likely not have time to review everything (boil the ocean) -> focus on the 80/20 to save time

3. Yes, definitely ok to take a minute or two to think through your structure. This is a time investment, which will save you time later on by avoiding poorly thought-out analysis

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