This case is based on a second-round McKinsey interview from a European office. The case has been sanitized and adjusted for confidentiality, but the topic, type of questions and target solutions reflect those in the interview.
Especially over the past year, interviews in top consulting firms have moved away from standard topics such as market entry, new products, etc. More and more cases try to engage candidates with new issues they are also likely to face as consultants - one of the most popular ones being around the digital trends that consulting clients have to adjust to. This case aims to give candidates access to one such case.
The case also includes detailed interviewer notes of what is assessed during the case.
Style Scape is a mid-sized retailer that sells clothing, accessories, and home goods through its physical stores and online platform. The business has been around for over a decade and has seen consistent growth in sales in its home market of the United States. Style Scape operates 30 stores nationwide, and its online platform is relatively new, having launched only two years ago.
Despite healthy growth, the company's leadership has noticed an alarming decline in customer satisfaction ratings and an increase in customer complaints. They are concerned that these issues will harm the company's reputation and negatively impact its bottom line. The CEO of Style Scape has requested your assistance in determining the root causes of these issues and developing recommendations to address them.
Your team has gathered additional information about Style Scape customers and their complaints.
Now that we have a better understanding of what drives customer satisfaction, we want to learn more about the potential impact of developing a retraining program to help our staff better manage customer interaction. The team arrived at the following estimates:
By how many percentage points would customer satisfaction need to rise for the investment to make sense? You can assume that for each percentage increase, the business generates an additional $250k in revenue.
The client is pleased with your analysis and is considering an investment in the training programme. Now that we understand the financial implications better, what sort of risks do you think the client should be prepared for?