Why do consultancies use case study interviews?
Case studies test you in all manner of ways so they are one of the best – and fairest – methods of seeing a candidate ‘in action’. They are designed to evaluate how you process information, solve problems and react to new and surprising situations, as well as showing how you work within a team. Individuals or a small group of candidates are presented with a business problem and then given time to evaluate the information and brainstorm a solution. Case studies can be on almost any topic. 'The topic itself doesn't matter. No one expects you to know the market size for diapers in Southeast Asia offhand, for example,’ says Roland Berger. ‘But what is your approach? Can you estimate it? Educating yourself in basic data, such as average population sizes, will help prepare you for market estimation cases. Can you demonstrate common sense and make educated guesses?’ Oliver Wyman advises: ‘Think of the case interviewer as your client. Your interviewer wants you to solve the problem, and can help. Work together.’
What to do in advance
Read the firm’s graduate recruitment literature and check its website to see if it has sample case studies (the vast majority of consultancies do). Have a look at recent press releases to get a feel for the type of work it’s involved with as well as what industries it works across. Read the business pages of newspapers and imagine one of the businesses to be your client. How would you advise them? What would you base your recommendations on? What factors would you and your client need to consider before proceeding to the next step? Also check with your careers service as many run workshops and presentations on how to prepare successfully for case studies and assessment centres.
‘I practised with friends beforehand, so by the time I started interviews I was more comfortable with what to expect,’ says Olivia, an associate at The Boston Consulting Group, echoing the views of the graduates TARGETjobs has interviewed. Consultants and interns offering advice via TARGETjobs Inside Buzz, agree. The message is: practise, practise, practise.
Advice from consulting firms
Through our research of top consulting firms the TARGETjobs team has come across some valuable nuggets of advice for succeeding at case study interviews, such as:
- 'Sketch out a structure: your path to the solutiuon. If you go astray, it will help you get back on track.' (Roland Berger)
- ‘Don’t panic if the answer is not apparent.’ (Boston Consulting Group)
- 'Pause periodically during the dscussion to give your interviewer a chance to course-correct.' (PwC)
- ‘If you need more data, ask for it. If you're stumped, take a creative leap.’ (Oliver Wyman).
Thinking out loud
The TARGETjobs team has been struck by a common thread – almost everyone we spoke to stressed that applicants should talk through their thought process with the interviewer. As L.E.K. Consulting puts it, ‘Formulate hypotheses – share your thought process as information is revealed.’ It’s a bit like making sure you show your calculations in a maths exam – it’s not enough just to come up with the answer. Given that case studies tend not to have ‘right’ or ‘wrong’ answers anyway, making your thinking process transparent is particularly important. ‘We do not expect candidates to actually solve the cases in interviews,’ says OC&C Strategy Consultants, Instead, the person interviewing you must be able to understand how you reach your conclusions – how you’ve broken the problem down, analyse information and structure conclusions.
If you're in a group...
If you’re working in a small group divide the tasks – you’ll get through them far quicker. There may be different personalities in your group and recruiters will be watching to see how you interact. They will also be looking for evidence of leadership and teamwork. Don’t dominate proceedings but do pitch in and contribute where appropriate. It’s important to be yourself rather than play to a type.
Expect the unexpected
Additional information may be sprung on you so be prepared. Interviewers will be looking to see how you deal with the unexpected as well as how flexible you are with processing last-minute information. Ask if you’re unsure about something. Asking clarifying questions such as ‘Does that make sense?’ to the interviewer, will ensure you’re on the right track and shows self-awareness.
Example case studies
We can’t tell you exactly which case study you’ll face, but we can give you a couple of examples of what it might be like:
Expanding a business
Your client is a global organisation that manufactures and distributes a wide range of chocolate products. They have two ideas to expand the business: either to introduce a new range through existing distribution channels or move into a completely new business, which will involve building a set of retail stores. To approach this, you will need to compare the returns of each of the different investments and decide which will be the better solution for the business. Make sure you can explain the reasoning behind your decision.
Increasing a supermarket's profitability
A supermarket chain has noticed a decline in its profitability. They have hired you to find out why this is and to recommend and implement a solution. You’ll need to work out why there is a decline in profitability – for example, is it specific sites or the entire chain’s performance that is suffering? Once you have identified the problems, work out a cost-effective solution that will allow the supermarket to address each in turn.
So, after writing the perfect resume and cover letter, and preparing at least 6 Hero Stories, it’s time to face the music. Just as there’s always a dragon to slay before rescuing the princess, there’s always a case interview process to master before landing the dream job.
Consulting firms rely heavily on case interviews to find the right candidate and, therefore, you should practice them – practice them well, start practicing them early (2-3 months prior to the interview), and then keep practicing them often. Once you have been requested to come for an interview it won’t be just to discuss your GPA, background, or experience – that ends up being important, but only later.
First, you have to show you have the skills to do the job.
Case Interviews give the interviewer an in-depth view of how you think/function under pressure, solve problems, and understand both the large picture and the smallest aspects of a problem. In addition, they are excellent test scenarios for communication on your feet. Case interviews go beyond just spouting business knowledge – you are tested on how you build and communicate a clear framework, break down problems into small pieces, develop real-world options, and recommend actionable solutions despite the presence of conflicting information.
The 2 case interview styles are Interviewer-led and Interviewee-led cases. In our Consulting Interview Bible, we go into the differences in great detail – but that’s not the point of this article. Within both case styles, there can be a mixture of case interview types.
Today, we focus on 6 types of case interviews. You could see any one of these 6 variations (and probably multiple ones) of a case interview in your final rounds, so it’s important to be familiar with each one of these (see sample case interview questions). We know we could do an entire article on each one, and very well might in the near future (comment below if you’d like to see more on this)! For now, however, let’s just get started.
We’ve ordered these from the most basic to the most complicated – when we work with Black Belt clients, we have them build up through the case types to develop increased ability as they tackle more difficult business problems.
Brainteasers are most commonly logic puzzles or riddles. They are meant to test both your analytical and creative thinking process.
Here are some sample brainteaser questions:
- How many golf balls can fit in a football stadium?
- How many miles of road are there in the United States?
In their purest form, brainteasers are uncommon in management consulting interviews, but we include them for 2 reasons. One, it’s good to be prepared for them in case you have an interviewer who decides to throw them in. Two, you solve them the same way you solve a market sizing question (see below) – by breaking down the solution into component parts.
2. Consulting Math
Consulting is a data-based industry – but where there are no facts, there are well-developed estimates. In regular math drills, you will not have the leisure of having a calculator. We are going back in time to the pen and paper and, your best resource…your smart brain. These drills are commonly elementary math but be prepared for fractions and percentages.
Again, these are not usually stand-alone case interview questions for MBB (although they can be in a time-pressured partner interview), but they are great practice for Problem Solving Tests (PST’s) and as components for longer strategic case interviews. Here’s a sample question:
- About 225 of Smith’s Investments roughly 20,000 employees have the title of partner. What percentage of all Smith’s Investments employees are partners?
- The market for lead pencils has been declining at 4%/year for the last 3 years. The original market was $24M/year. What is the market in year 3 (now)?
Unlike science math, consulting math only expects close-to-correct answers. In science or technology, a tiny margin of error can lead to major accidents. However, in business, decisions can be effectively and efficiently made based on near-perfect data/calculations.
For Problem Solving Tests, multiple questions like these are asked with a time limit – either in spoken form or in written form, and usually with under 2 minutes to answer each question. In written form, they are multiple choice questions. Make sure you know major currency exchange rates of the office you are wanting to join.
GMAT and GRE tests are excellent practice for consulting math.
3. Market Sizing
Market sizing questions are fairly straightforward and should be solved in 8-10 minutes and 4-5 steps with 1 level of segmentation. You are measuring the existing market of an item in total units or total sales ($) – it’s important to clarify up front which one it is. Sample market sizing questions include:
- How many hamburgers are consumed in the U.S. in one year?
- What is the size of the U.K. market ($) for helium balloons?
For market sizing, you are using the size of the market as the baseline to answer strategic questions like:
- How many of X exist in the market?
- How fast is the market for X growing?
- What is the $$ opportunity if a client introduces X into the market?
In most market sizing cases, the interviewer has no clue of the exact solution – nor does she care. The emphasis is more on how you arrived at your conclusion (did you go off on a tangent? could you defend your assumptions?) rather than the conclusion itself.
Also, for market sizing questions, be prepared for adjustments at the end of the case – “What if the % of the population used was this? What is your most sensitive assumption?” Because you are preparing a spreadsheet (a mini-financial model) on the fly, be prepared to adjust your inputs – just like you would on a real-life consulting project.
Profitability is the ultimate business metric, and profitability cases can address a business in any industry. This case type names a company and gives some detailed history and factual data, and poses one of three questions:
- What should Company X do about revenues (prices x volumes)?
- What should Company Y do about costs (fixed costs + variable costs)?
- What should Company Z do about overall profits (including both sides of the profit equation using metrics such as profit/unit or profit/channel)?
In our worldview, there are 4 types of profitability questions:
- Declining profitability
- Profitability – revenue-focused
- Profitability – cost-focused
- Profitability – scenarios
In the first type, profitability questions can cover why a company might be losing profits or what a company should do to increase profits creatively. Your job is to set up a framework to help them find the source of the issue. The framework should be in 2 levels, and beyond revenues and costs, it could highlight a potential internal company or product problem, competition or a global market issue, etc.
Revenue- or cost-focused profit questions aren’t necessarily posed as profit questions (the word profit isn’t used in the set-up). For example, maybe a company is integrating a new software infrastructure and they want to know if it’s a “good idea”. The focus is on quantifying the benefits of new business infrastructure solutions – benefits that translate to increased sales or reduced costs.
Also, revenue and cost questions may be focused on non-financial decision making – for example, “X is deciding whether or not to run for office. Should they or shouldn’t they?” Meaning, they are not referring to financial outcomes, but are still quantifiable – your job is to think about the issue with a 360-degree view and develop a well-structured pro and con list.
Lastly, you might encounter a weighing scenario question. You would be given 2 options and will need to weigh the profitability of one against the other. An example of this might be comparing the use of the U.S. Post Office for mailing needs versus UPS. Or maybe the company is trying 2 different types of packaging for a product; one is 3 oz. and the other is 8 oz. Which packaging would you recommend and why?
5. Market Study
Market study questions come in 3 forms:
- Market Entry
- Revenue Growth
- Market Share
The first type, market entry, addresses a scenario where a company is interested in entering a new market. You are really answering another question – how much money will they make, will they be profitable entering that market, or how should they enter that market?
In the second scenario, a company is trying to grow their revenues. Your job would be to brainstorm how they could obtain this goal. If you look at it through the lens of profitability, would it be by increasing prices or volumes (market study would be the second level of analysis)? If you look at it through the market study lens, you look at market factors (competitors, customers, supply/demand, etc.) that would affect growth plans – and profitability would be the second level of analysis. In either case, your job is to identify any warning signs that might hinder this company from achieving this goal.
A final type of market study question would address a company declining in market share. In this scenario, you need to focus on overall company growth and how it has been affected by competitors and customer loss. You are looking for a way to grow in context to the current market competition.
6. Merger & Acquisition Cases
M&A cases are the mac-daddy of all consulting cases because they include market sizing, profitability, and market study cases – with a fair share of case math thrown in. The cases will either be about whether Company A should merge with Company B or if Company Y should purchase Company Z.
Details of what type of product or services will be included and a limited amount of factual data relating to both the purchasing and the target business. When asking 1-3 clarifying questions, focus 80% on the target and only 20% on the parent/acquirer.
There are 2 types of Merger and Acquisition purchasers – financial and strategic acquirers. Understanding the motivations of both will help you identify how best to evaluate the target. Remember, however, the goal for both types of acquirers is…as always…increased profitability.
After you have a better understanding of the case types, that’s where the real work begins – developing actionable frameworks for each.
In any case type, you will need to recap the question back to the interviewer. This will help you and the interviewer ensure you understand the business problem you are solving. Make sure you include all the factual details given. Your recap should take up to 2 minutes and will reflect your understanding of what the company does, what the company is trying to decide, and how they currently make money. Be confident – it’s your first impression.
When choosing your framework to remember to identify the areas that need further examination in order to come to your conclusions. You are not being asked to conduct a hypothetical analysis.
Now that we have highlighted 6 case interview types, it’s time to get cracking!
Want more help? Grab our most popular combo – the Consulting Case Bank(550+ cases; includes a copy of the Consulting Interview Bible).
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