Monday, October 20, 2008

Case prep by Group - "Crackers"

Case Prep – Group “Case Crackers (Ankita Gupta, Chandrakanth Chereddi, Manish Lunia, Pragati Lodha and Karthik Chaitanya) has been kind enough to share their insights about case preparation

A. The Problem – Please refer HBS Case Book – Practice Case 9 (Wheeler Dealer) http://atrium:14825/ConsultingClub/Placement%20Prep/Forms/AllItems.aspx?RootFolder=%2fConsultingClub%2fPlacement%20Prep%2f04%20Casebooks%20of%20Other%20B%2dschools&FolderCTID=&View=%7bBFFFA453%2dEF26%2d4B81%2d8ABC%2d3582A5CEFF76%7dacement%20Prep%2f04%20Casebooks%20of%20Other%20B%2dschools&FolderCTID=&View=%7bBFFFA453%2dEF26%2d4B81%2d8ABC%2d3582A5CEFF76%7d
One approach
1. The first thing to do when you get a case like this is to figure out the kind of structure you need to bring to the problem.

2. We prepared a simple 2x2 without trying to force fit any sort of strategy model. This case is simple and starting with a simple case will help you construct mental models that will help you understand how to break down further complicated cases.

3. You already know that the chain was profitable before the expansion. So the first segregation is temporal. Something has obviously gone wrong with the new sets of stores.
4. The first question to ask could be “are there multiple categories of products sold at the stores?” This will help you build the horizontal axis or the Line of Business segregation.
5. Now you have 4 quadrants to work with and this presents your first structure. Your line of thinking is now immediately channeled into a more productive mode.
6. First set of questions focus on inter-LoB differences. Are quadrants I & III (Services) different from II & IV in terms of their demand model and customer segments served (the revenue drivers), profitability, topline growth etc. etc. You get the drift.
7. The next questions should focus on intra-LoB difference – i.e. between quadrant I and III.
8. The recommended solution in the case book will help you through the questions that could be asked. We felt that drawing a structure like the one above easily stimulates a lot of the questions.
9. Once you understand that quadrants II and IV are traditionally low on margins, you get an indication that the problem probably lies in the quantum of customers from each LoB the new stores are attracting. This will help you question the geographical location since you will get an indication during points 6 and 7 that the customers arriving at the Services LoB are smaller than they should be.

B. The Problem – Please refer Wharton 1996 Case Book –Case 1 (Cable Television) http://atrium:14825/ConsultingClub/Placement%20Prep/Forms/AllItems.aspx?RootFolder=%2fConsultingClub%2fPlacement%20Prep%2f04%20Casebooks%20of%20Other%20B%2dschools&FolderCTID=&View=%7bBFFFA453%2dEF26%2d4B81%2d8ABC%2d3582A5CEFF76%7d
1. This was also an important case for us from a learning standpoint. We applied a different structure to this

2. Apply a structure that suits you. But force yourself into some sort of structure (not framework). This is what all firms look for.

C. Summary of Kellogg Case Book Tips on Case Preps

1. Usage of Frameworks à Important to help you summarize and synthesize in between and the end of the interview. Should not be relied on completely. Thinking should be flexible since every case is unique.
2. Avoid saying “I’m going to use the 4 Cs framework for this case.” Instead, say.. “In order to understand whether or not the acquisition of Firm B by Firm A is a good idea, I’m going to examine Firms A and B in terms of their competencies and cost structures (Company), get a sense of the existing players in the market (Competitors and Collaborators), and understand who they sell to (Customers).Uncovering this information will help me to determine whether or not enough strategic synergies exist between Firm A and B to justify an acquisition.”
3. Common Frameworks à
a. Porters 5 Forces,
b. 5C,
c. Consonance Analysis – Benefit & Cost Drivers,
d. Profit=Revenue-Cost,
e. Value Chain,
f. 4P,
g. Market Segmentation & SPSG (Size, Profit, Share, Growth),
h. Internal / External,
i. Microeconomics,
j. Cost/Benefit,
k. NPV and Cost of Capital
4. Run through 2-3 frameworks on one case to get a better handle on the frameworks.

1. Cases à Either has very little initial information, meaning it will be vague and open à Lots of information will be given up front à Case given as handout prior to interview itself
2. Listen carefully à Make notes à Summarize problem so that on same page à Will have tons of obscure information, focus on main points à Clarify issues à Take a brief pause (ask interviewer if ok – up to a minute)
3. Once you have clarified and understood à Think of some framework that can be applied (market entry – Porter & Internal/External, profitability – Profit=Rev-Cost etc.) à Don’t obsess over the framework, use it to guide you through to prioritize and ask the right questions
4. Initial information à takes you down certain paths à prioritize the paths using frameworks à ask questions to either accept or deny the paths
5. Formulate the hypothesis or the central problem with the case/firm eg. The firm is selling more low profit, high volume products which has reduced the average profit per SKU
6. Not getting to the right hypothesis at first try is not a disqualification, you can always go back to the central issue and try a new path à However losing track of the available paths could create an issue
7. The question is whether you must form a hypothesis right at the beginning of a case or based on asking some more information à Depends upon the approach interviewing firms take in their real life consulting methodology
8. Articulate in a manner that represents structure thinking à Think aloud and let the interviewer hear your thought process à Also write down your thinking and frameworks à Sketch out your thoughts and let the interviewer see what you are doing, they are graphic thinkers
9. Explain all your calculations to the interviewer à Asking all logical questions will help the interviewer guide you through the interview
10. Rather than saying, “”Could you tell me about the company’s products?”, a better approach is to say:“”I know that product mix can often affect profitability. I’d like to explore this issue with respect to Company A. I’d like to know, for instance, what products the company offers and if this has changed over the last few years”.
11. Keep getting unstuck à Always identify the root problem you are solving in the case and keep homing in back there when you are stuck
12. To that end, if time runs out before you can finish your analysis and can make a recommendation, summarize where you are, what you have learned, where you would go next, and make a preliminary recommendation. For example, “Given that I know X, Y, and Z, I would recommend the firm do [action] at this point. However, I would still want to investigate A, B and C to complete my analysis.” A preliminary recommendation beats no recommendation, and the interviewer may very well ask for one.
13. Reserve a corner of notepad for noting down key findings of the case interview so that it will help you identify summary in case you need to end your case interview quickly

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