Some positions will require that you be given a business case study to test your business acumen and analytical skills. If you are interviewing for a top consulting firm, such as McKinsey, BCG, or Bain, then my framework will be too simple for you. There are entire books and courses that teach you how to structure, break down, and solve business cases for interviews at those consulting firms. I've personally gone through many cases myself and practiced with others. Here, I have taken the key lessons I have learned and condensed it into one post by providing a simple framework that will work for the majority of Fortune 500 business case interviews.
Profit = Revenue - Costs
That’s all you have to remember. If you are asked how to increase sales, think about strategies to increase revenue. If you are asked how to reduce costs, think about ways to reduce costs. If you are asked to improve profits, simply break down what profit is--revenue minus costs. Then figure out ways to increase your revenue and decrease your costs.
How do you increase your revenue? The key is to ask clarifying questions so you understand the issues, the market, and the business environment. There’s no need to memorize questions to ask. Just keep poking at it until you understand what is going on. Once you have a good grasp of the relevant issues, you can develop strategies to increase revenues.
Formulaically, revenue is price X quantity. Think of ways to increase the price or quantity. Here are some ideas to think about to increase revenue.
Similar to revenue, you want to understand the main drivers of cost. Again, simply ask clarifying questions and keep poking away until you understand what’s driving your costs up. Be sure to write down the key points.
Here are some ideas to decrease costs.
The key here is to identify where most of your costs are coming from and then figuring out a way to lower those costs.
I highly recommend incorporating your own creativity and experience into these case studies. For example, if you worked in retail, you understand the consumer shopping cycle and how stores market differently depending on the season and holidays. You can use that experience to come up with a superior marketing strategy. If you have a tech background, you may be able to introduce a technology that will drastically cut time and resources. If you worked in procurement, you can leverage your knowledge of negotiations and supplier base rationalization to cut costs. If you have experience creating business partnerships, you can come up with ways that the company can partner with another company to improve revenues. There are so many different directions you can go. Being able to demonstrate your creativity to your interviewer is much more powerful than giving a standard cookie cutter response.
Depending on the position you are interviewing for, you may need to demonstrate your ability to quantify things and make quick calculations. In that case, I recommend writing down the numbers and rounding them. Don’t get too lost in the numbers, and more importantly, don’t lose sight of the big picture.
I would also like to emphasize the importance of structuring the case, organizing your data, and solving the key issues. You will most likely be given pen and paper to write on. Take advantage of that by writing down the details and writing down your calculations and lists one-by-one. Draw diagrams if you need to. Also, remember to breathe, stay calm, and ask clarifying questions. Good luck!
For more interview advice, check out my post on non-verbal communication and interview tips. For help on Excel interviews, please see my book.
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