Vault_2-_Cases

Vault Case Interview Practice Guide 2: More Case Interviews

Sample Cases

(Below is an illustration of this approach using the framework described, and an approach using Porter’s Five Forces framework (on page 163). The Five Forces are not used throughout the rest of the case but are shown here as an example of another approach that an interviewee could take.)

		Has our company changed its products or
		services in some way that has made us lose
		business?
	COMPANY	• Different product offering? Different
		product composition?
		Has our company failed to innovate in the
		market, or keep up with the competition?
		Have the customers decreased?
		• Have customers gone elsewhere?
	CUSTOMERS	• Have we stopped serving a customer need
		Have customers started spending less?
		Are there new customers that we should go
		pursue?
		Who is our competition?
		• Are there numerous competitors? Or have
	COMPETITORS	market shares remained fairly stable?
		Has competition increased recently? Are new
		competitors predictable or unexpected?
		Is the market for telecom equipment growing or
		shrinking?
		• What’s been the recent trend? What’s been
	MARKET SETTING/	the long-term trend?
	DYNAMICS	• Have there been market-changing events/
		inventions recently?
		Is this a local or global market? Are there new
		markets left to enter/expand into that are as yet
		untapped?

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Sample Cases

THREAT OF NEW

ENTRANTS

BUYER POWER

RIVALRY

SUBSTITUTES/ COMPLEMENTS

SUPPLIER

POWER

•Are new entrants likely? Have there already been new entrants?

•Are there any barriers to entry?

•Patented technology?

•Government regulation?

•Are the number of buyers concentrated, or diffused?

•How many buyers are there in the market?

•Is the number of buyers growing or shrinking?

•Has negotiating power on the buyer side recently increased for some reason?

•Has there been government intervention to increase buying power?

•Has rivalry increased in the market?

•Are market shares changing because of increased rivalry?

•Has competition increased?

•Are there substitutes to our product that now exist in the market?

•Are there complements to our product category that could stabilize our share, or that are increasing rivalry?

•Have suppliers increased in power?

•Have the suppliers increased or decreased?

•Are key suppliers working more in tandem with our competition than with us?

•Are suppliers vertically integrating, increasing competition in the industry?

Firm: That’s great. You’ve brought up a lot of questions for analysis. But instead of just asking questions, do you have any hypotheses about what might be going on here in those four buckets?

Interviewee: Sure. Can I take a few minutes just to write them out?

Firm: Of course.

(A few minutes go by …)

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Vault Case Interview Practice Guide 2: More Case Interviews

Sample Cases

Interviewee: Well, I have several. They are …

COMPANY

CUSTOMERS

COMPETITORS

MARKET SETTING/

DYNAMICS

•Hypothesis: The company has changed its product offering and no longer meets customers’ needs.

•Hypothesis: The company has failed to innovate to keep up with the competition

•Hypothesis: There are fewer customers because our typical customers have gone to the competition.

•Hypothesis: Our customers have started to spend less on our category.

•Hypothesis: Competition has increased, driving prices down.

•Hypothesis: Competition has increased, fragmenting the market.

•Hypothesis: Unexpected competition has entered our market with new substitutes for our category/product line.

•Hypothesis: The telecom equipment market is shrinking.

•Hypothesis: The telecom equipment market is growing, but not in the markets that we are in.

•Hypothesis: The telecom equipment market has slowed, due to a recession or some other unforeseen market force.

Firm: That’s a pretty comprehensive list. Now, before we dive into that list and get at the client’s problem, can you tell me what data sources you might look at to prove or disprove each of those hypotheses? Take a couple of minutes, or brainstorm out loud—whatever you’re more comfortable with.

Interviewee: Sure, let me collect my thoughts for a minute … OK, so I have the following list:

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Vault Case Interview Practice Guide 2: More Case Interviews

Sample Cases

	• Company’s product offering over time vs. com-
		petition’s product offering over time
COMPANY	• Surveys of customer satisfaction
	• Company’s market share
		• Customer surveys
		• Customer annual reports
CUSTOMERS		• Lit searches and analyst reports for industry
		• Trade journals for industry
		• Number of customer companies (has this
		grown, or shrunk?)
	• Number of telecom equipment manufacturers
		from an industry board or trade publication
COMPETITORS	• Market shares from industry reports
	• Lit searches and analyst reports on industry/com-
		petition
	• Annual reports of competition

MARKET SETING/

DYNAMICS

•Lit searches and analyst reports on industry/competition

•Interviews with industry thought leaders

•Interviews/surveys with customers

•Annual reports of competition

Firm: That’s great. Now, back to your hypotheses. Where would you like to start in tackling this problem?

Interviewee: In terms of the company, maybe it has changed its key product or service, which has led to a decrease in volume, or maybe it hasn’t changed its product offering to keep up with the competition or the innovation happening in the market.

Firm: That’s a good couple of hypotheses. Unfortunately, we looked a bit at that, and the client’s offering is the same as its competitors in the market. Let me tell you a bit more about the client. It’s a global telecom equipment/services provider based in the U.S., but it serves a global customer group. The client serves primarily business customers, like large global corporations that need their own global networks, dedicated lines, etc. However, it has started to serve home offices for global business customers, and developed small office/home office product lines

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Vault Case Interview Practice Guide 2: More Case Interviews

Sample Cases

and operations in markets where those are quite prevalent. Does that give you any further insight?

Interviewee: Actually, yes. I take from that that competition isn’t really the problem here. I mean, one of my hypotheses had been that new competition had entered the market, taking customers away from us, or introducing substitutes in the market that has decreased demand. But now I’m thinking that the competition has little to do with the client’s problems.

Firm: You’re right. We looked there, too. And it seemed that the competition was facing similar problems to those of our client. What other hypotheses do you want to explore?

Interviewee: Well, you mentioned that our client serves a global customer group, and that we’ve primarily served business customers, but are starting to serve consumers with home offices. Have we somehow driven our normal customer base away by starting to serve consumers? Or, if I go back to my hypotheses, are our business customers just spending less on telecom equipment than they used to?

Firm: Now you’re really getting somewhere. Customers are spending less on the telecom equipment category. You see, what we found was that the global telecom industry surged in the 1990s, but in recent years, due to a tremendous supply in global telecom capacity, demand for telecom equipment dropped quickly. All traditional global telecom manufacturers and suppliers were hit hard by this turn in the market.

Interviewee: So, it’s my last bucket then—there are marketwide dynamics that have caused the client’s decline in volume, declines in sales, and decline in profitability.

Firm: Yes. But what do you suggest for it to do to fix the problem? How do you suggest that it grows its revenue?

Interviewee: Well, the first thing that comes to mind is targeting a new type of consumer. You mentioned that the client typically sold its equipment to business customers, but that it is starting to sell its products to consumers with home offices. Can it grow that business in any way?

Firm: That’s a good hunch. And yes, it can. But we didn’t want to just tell the client that for two reasons: 1) it’s already growing its consumer segment; so, it doesn’t add much value for us to just tell the client to continue doing something that it is already doing, and 2) because of its product line and the size of the two markets, there’s no way that it could make up for all of its lost revenue from the business customer market in the consumer market. Any other ways that it might be able to restore its revenue?

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Sample Cases

Interviewee: Well, if it can’t just restore revenue by targeting a different customer type, is there a new geographic market that it could enter for its business customers?

Firm: That’s a good thought, too. But unfortunately, it’s already a global player—most markets have already been tapped.

Interviewee: Can it start to do something that it hasn’t done before, like manufacture a different type of product?

Firm: That’s another good thought, too. But it needs solutions for its profitability now, and changing what it manufactures and brings to market will take years for it to see substantial revenue from that investment.

Interviewee: Well, if it can’t enter a new product market and can’t enter a new customer market, is there something else that it’s now doing that it could grow, which I haven’t considered?

Firm: You’re on the right track. What capabilities, other than manufacturing telecom products, does the client have?

Interviewee: If I review my notes, I believe you said that it’s a global telecom equipment manufacturer and services provider. Wait, that’s it. What kind of services does it provide?

Firm: Good question. The client has traditionally gotten 80 percent of its revenue from its telecom equipment manufacturing business and 20 percent from its installation/maintenance and services business. What does that make you think?

Interviewee: Is there any way that it can grow its services business? I mean, business customers may have enough capacity and equipment, but maybe the client could use more servicing and maintenance of that equipment?

Firm: You’re right. That’s it. And that’s what we recommended to the client.

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CAREER

GUIDE

FINAL

ANALYSIS

CASE INTERVIEW PRACTICE GUIDE

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Final Analysis

Final Analysis

In conclusion, there are a few things to keep in mind not only as you prepare for your case interviews, but as you walk through the door to the interview.

First, practice will help you. Like any test, assignment or hurdle, practicing will make you more comfortable with the skill set, better at the problems and more able to surpass the hurdle. Practice may never make you perfect—most consultants will tell you that they’d probably do horribly if given a case interview today, but they were likely much better at them when they were preparing for all of their case interviews.

Second, practicing cases and going to case interviews will in many ways help you understand if you want to be a consultant. If you find case interviewing wholly miserable, then maybe consulting isn’t right for you—either way, working through this book is an important step to helping you figure that out.

Third, while you can practice for years and become the master of every style of case interviewing, there’s one thing to keep in mind: the one thing that you kind of can’t prepare for, but should prepare for, is the unexpected. Case interviewers get tired and cut the case short. Case interviewers get bored, stop giving the prescribed case and start giving a brainteaser instead. A seasoned case interviewer gets called away to a client meeting at the last minute, and a consultant who has never given a case interview before in his life gets called to stand in and be your interviewer. You may not have the most perfect interview setting when you interview—but you don’t have much control of that! What you do have control over is how you react to it: if you’re flexible, calm, good-natured and helpful through it all, well, then you may just show how you’re the perfect consultant: still being smart and personable even when your flight home from the client site is canceled.

Finally, it never hurts to just keep your fingers crossed, have a little luck and keep things in perspective. If you practice and work through the cases in this book, you will have done more than many other applicants and probably be better prepared than most—and with a little luck, you’ll do great and get the job!

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