2017 Case Interview Workshop III presented by the Consulting Club at the Texas Medical Center

1. CASE INTERVIEW WORKSHOP
PART I & II REVIEW

2. OUTLINE
1. What is a case interview
2. What are consulting firms assessing during a
case interview
3. Overall strategy for preparing for case
interviews
4. Components of a case interview

3. WHAT IS A CASE INTERVIEW?
 Interview where the applicant is given a
business situation/problem/challenge and
asked to resolve the situation.
o Analyze in a structured, hypothesis-driven
manner
o Provide a data-backed recommendation
 Communicate with the interviewer as if you are
a consultant and the interviewer is the client

4. EXAMPLES OF BUSINESS
PROBLEMS
 How much profit can Cure Pharmaceutical Inc.
make three years after launching its new drug?
 A major fast-food chain is losing money in Texas,
why and what can they do to turn around?
 The competitors have adopted a new digital
technology, should auto insurance company BBB
follow?
 Should BlackRock Venture Capital firm acquire Big
Yellow School Bus Co.?

5. WHY DO CASE INTERVIEWS
EXIST?
 They simulate on-the-job experience
 Clients ask estimate questions all the time
 Prove yourself as a consultant
 Ask thought-provoking questions client hadn’t
considered
 Analyze data to discover new insights clients hadn’t
seen
 Develop data-supported conclusions that lead client
to a decision

6. WHAT CONSULTING FIRMS ASSESS
DURING A CASE INTERVIEW
 Hypothesis-driven problem solving
 Communication skills
 Public math skills
 Business acumen
 Client-facing demeanor

7. HYPOTHESIS-DRIVEN PROBLEM
SOLVING
Understand the
problem/issue
Draw
hypothesis
Lay out
structure or
issue tree
Prioritize and
focus on the
major issues
Perform
quantitative and
qualitative
analyses
Derive insights
from the
analysis
Draw
conclusions and
make
recommendatio
n

8. COMMUNICATION
 Listen and take notes
 Engage and align with the interviewer
 Ask logical questions
 Be structured in both verbal and written
communications
 Speak succinctly without rambling or being
robotic
 Speak firmly and convincingly

9. PUBLIC MATH SKILLS
 Do the math accurately
 Do the math quickly
 Speak out loud when doing the calculation

10. BUSINESS ACUMEN
 Know basic business terminology
 Research the industries
 Connect data and analysis with business
needs
 Make sound recommendations
 Think of risks and next steps

11. CLIENT FACING DEMEANOR
 Present professionally
 Be confident, not arrogant
 Align with the interviewer proactively
 Remain cool and calm when challenged
 React properly to pressure or mistakes

12. OVERALL STRATEGY
1. Understand the skills and abilities that should be
demonstrated in case interviews
2. Acquire general business knowledge
3. Understand the different case types
4. Utilize external tools
5. Know how to open, analyze and close a case
6. Practice with partners in-person
7. Summarize cases practiced and keep a case
journal

13. *Adapted from Duke (Fuqua) casebook

14. DIFFERENT CASE TYPES
 By format
 Candidate-led
 Interviewer-led
 Written/presentation
 Group
 By content
 Market entry
 Profitability
 Growth, expansion,
relocation strategy
 Response to
competition
 Merger and
acquisitions
 Many others

15. CASE INTERVIEW
PREPARATION RESOURCES
 Case preperation books
 Case Interview Secrets
 Case In Point
 Crack the Case System
 How to Get into Top
Consulting Firms
 Graph In Point
 Business school
casebooks
 Consulting firm websites
 Audio resources from
Victor Cheng
 Look Over My Shoulder
 Behind Closed Doors
 Consulting prep websites
and their YouTube
channels
 caseinterview.com
 managementconsulted.com
 mconsultingprep.com
 firmsconsulting.com
 Magazines and
newspapers
 The Wall Street Journal
 Harvard Business Review
 The Economist
 Bloomberg Businessweek
 Financial Times
 New York Times - Business
Day

16. COMPONENTS OF A CASE

17. COMPONENTS OF A CASE
 Opening
 Analysis
 Closing

18. OPENING THE CASE
1. Take notes
2. Summarize the prompt
3. Ask clarifying questions
4. Pause to prepare a structure
5. Present hypothesis and structure

19. ANALYSIS
1. Select one component of the structure
2. Analyze using process of elimination
3. Comment on significance of numbers
4. Update structure with insights
5. Synthesize what you have learned
6. Move to next branch
7. Exhaust all branches

20. Profit
Revenue
Price Volume
Costs
Fixed Variable
Finished
parts
Raw
materials
Labor
WORKSHOP I: PROFITABILITY
Agriculture equipment
assembly - tractors
Profit – last yr $4M
this yr -$2M
Why?
160 tractors x $50K
$6M
Hypothesis: Pricing is driving low sales
Objective: Why are profits down?
comp doing fine
premium product,
higher price
costs – raw materials,
finished parts, labor
sell to farmers

21. WORKSHOP II: ADVANCED
PROFITABILITY
Objective: To maintain profits
Hypothesis: Since revenues are bound to decline,
profits can be maintained by cutting costs
Profits
Revenue
Jet sales
Quantity Price
Jet
maintenance
Quantity Rate per
jet
Costs
Jet sales
Jet
maintenance
Client: Fighter Jet Manufacturer
• Customer: U.S. Air Force
• 10-year contract
• Possible decline in revenues
starting next year
Clarifying questions
• Only 1 customer
• Only 1 product = $20 M/jet
• Manufactures and maintains
jet. Paid upfront for jet and
yearly for maintenance.

22. WORKSHOP II: MARKET ENTRY
Client: Redox Solutions
• Makes antioxidant
treatments
• A drug for KD passed
phase I trials funded by a
donor
• KD market is saturated
• CEO wants to push
forwards. Doable?
Clarifying questions
• Need $300M  in year 1
• Redox sells drugs to
patients
• US market only
• KD is an inflammatory
disease targeting joints
• Lung/heart disease kills
patients, not joint damage
• Drug advantages: no side
effects in humans; may
treat comorbidities unlike
other drugs
Objective: Should Redox Solution enter the KD
market and make $300M  in Year 1?
Hypothesis: Yes, considering their unique
advantages
1
2
3
4

23. TARGET MARKET AND
CUSTOMERS
KD market
Market size
Stakeholder
needs
Patients Providers Payers

24. COMPETITIVE LANDSCAPE
Competition
Current KD
treatments
Market
penetration

25. INTERNAL FACTORS
Redox
Solutions
Expertise and
capacity
Capital
available
Economics
Projected
revenue
Cannibalization Upfront costs Operating costs

26. PRODUCT DETAILS
Product’s
value
proposition
Efficacy Safety Convenience
Intellectual
property
X factors
40% Patente
d
granted
this year
No side
effects
Weekly
injection
May treat
comorbidities

27. CLOSING
1. State recommendation or conclusion clearly
2. Two or three supporting reasons
3. Risks
4. Next steps

28. COMMON MISTAKES
 Not understanding the objective
 Not talking out loud
 Asking too many questions
 Using a generic or broad structure
 Proceeding with the case in a random or non
hypothesis-driven manner
 Failing to present a strong recommendation

29. CASE INTERVIEW WORKSHOP:
PART III

30. DIFFERENT CASE TYPES
 By content
 Market entry
 Profitability
 Business situation/strategy
 Mergers and acquisitions
 By format
 Interviewer-led
 Candidate-led
 Written/presentation
 Group

31. MERGERS AND ACQUISITIONS (M&A)
CASE

32. PROS AND CONS OF M&A
Pros
 Increases market
share
 Reduces competition
 Introduces less risk
(v.s. developing new
products)
Cons
 Increases financial
risks
 May not achieve
synergy
 May introduce clash
in company culture

33. REAL-LIFE M&A CASES

34. PROMPT
Our client is a beer brewing and retailing company in
the east coast. Their products serve the regional
“low-end” market and the company has a steady
growth in sales. Currently our client is actively
seeking acquisition opportunities and interested in
Bita Beer Company, a beer brewing company serving
the “high-end” market in the west coast. Our client
has hired us to help them figure out whether this is
an attractive acquisition.

35. SUMMARIZE THE PROMPT
Candidate: Thanks for the information. This is an
interesting case. It sounds like our client is doing
well in business and looking for acquisition
opportunities. Buying Bita Beer Company could
be a great move for our client in terms of
expanding their business. I’m happy to help them
make the decision.

36. CLARIFYING QUESTIONS
 Client’s goal
 Geography
 Price

37. CLARIFYING QUESTIONS
Client’s goal
 Candidate: Does our client have any specific
quantitative goal for this acquisition?
 Interviewer: The rationale of our client for this
acquisition is to develop a premium beer
product aiming the high-end market.
Meanwhile, our client hopes the investment
associated with this acquisition would be
profitable in 5 years.

38. CLARIFYING QUESTIONS
Geography
 Candidate: Our client is a east coast company.
Why are they looking so far away for the
acquisition?
 Interviewer: Good question. That’s because
currently there is no company in the east coast
for sale. The premium beer market is mainly on
the two coasts.

39. CLARIFYING QUESTIONS
Price
 Candidate: I assume Bita Beer Company is on
sale. If so, what is the asking price?
 Interviewer: Yes, Bita Beer Company is on sale
and asks for $200M

40. PREPARE THE STRUCTURE
Client: A Beer producer
and retailer
• Serving “low-end”
market in east coast
• Steady growth in sales
• Acquisition target: Bita
Beer Company a
premium beer producer
in west coast
Clarifying questions
• Return on investment
(ROI) in 5 years
• No acquisition target in
east coast
• Acquisition price:
$200M
Objective: Return on investment in 5 years
Hypothesis: This will be an ideal acquisition and our
client can achieve its business goal.

41. PREPARE THE STRUCTURE
Client: A Beer producer
and retailer
• Serving “low-end”
market in east coast
• Steady growth in sales
• Acquisition target: Bita
Beer Company a
premium beer producer
in west coast
Clarifying questions
• Return on investment
(ROI) in 5 years
• No acquisition target in
east coast
• Acquisition price:
$200M
Objective: Return on investment in 5 years
Hypothesis: This will be an ideal acquisition and our
client can achieve its business goal.
Industry
dynamics
Market size Competition Market
growth
Synergy with
client
company
Increase
sales?
Reduce
cost?
Brand
value
Company
culture
Cannibalizatio
n
Target
company
Customer Product Profitability
Revenue
Cost

42. INDUSTRY DYNAMICS
Industry
dynamics
Market size Competition Market
growth

43. MARKET SIZE AND COMPETITION
 Candidate: Do we have any data about how big
the markets are and the market share of Bita
Beer Company?
 Interviewer: Yes. Why not take a look at Exhibit
1 and tell me what you find?

44. EXHIBIT I
Total: $800M Total: $1 billion
2015 West Coast Premium Beer Market 2015 East Coast Premium Beer Market

45. INSIGHTS FROM EXHIBIT 1
 Candidate: I found two things from Exhibit I:
1. In the west coast, Bita Beer Company takes 25%
of the market share, which is the highest among
all the other competitors
2. In the east coast, the market size is larger with
relatively less competition. It seems domestic
beer is more popular in the east coast.
 Candidate: I’m thinking it could be a great
opportunity if our client can introduce the beer of
Bita Beer Company to the east coast. I would like
to explore this idea later if we have time

46. MARKET GROWTH
 Candidate: Do we have any data about the
overall market size and Bita Beer Company’s
market share in previous years?
 Interviewer: The overall premium beer market
size has been stable in the past few years.
Meanwhile, Bita Beer Company had an
average of 5% growth of its market share in the
past 3 years.

47. PART I SUMMARY
 Bita Beer Company is in a leading position in
the west coast premium beer market.
 The overall premium beer market growth is
stable and Bita Beer Company outperforms it
 Domestic premium beer is more popular in the
east coast where there is less competition. It
could be a good opportunity for our client to
introduce a new premium beer.

48. TARGET COMPANY
Target
compan
y
Customer Product Profitability
Revenue
Cost

49. CUSTOMER AND PRODUCT
 Candidate: What makes Bita Beer Company’s
beer so popular in the west coast? Do we have
any data about its beer and who are the
customers?
 Interviewer: Absolutely. Bita Beer Company has
a trade secret that improves its brewing
process, yielding fresher and better tasting
beer. As for the customers, we don’t have any
data about them. It seems that their beer is
popular among all ages.

50. CUSTOMER AND PRODUCT
 Candidate: I would like to confirm that our client
will be able to produce the beer of Bita Beer
Company in the east coast after the
acquisition. Are there any special processes
that limit the factory only to the west coast?
 Interviewer: That’s a good point. Actually all the
techniques are transferable after the
acquisition.

51. PROFITABILITY
 Candidate: I see. I was wondering is Bita Beer
Company profitable?
 Interviewer: That’s a good point. How do you
plan to analyze that?
 Candidate: Based on Exhibit I, we should have
some information to calculate the revenue. If I
can have some cost information, I should be
able to calculate the profit.

52. PROFITABILITY - REVENUE
Revenue:
$800M  25% = $200M
 Candidate: Do they have
any other source of
revenue?
 Interviewer: Not that we
know of.
 Candidate: Excellent. Do
we have any data about
their cost structure?
Total: $800M
2015 West Coast Premium Beer Market

53. EXHIBIT II
Average cost of a bottle of
beer
($)/bottle
Raw materials 0.5
Labor 0.1
Transportation 0.2
Storage 1
Package 0.2

54. INSIGHTS FROM EXHIBIT II
 Two findings
1. Total variable cost = 0.5 + 0.1 + 0.2 + 1 + 0.2 =
$2
2. Storage cost is the highest among all variable
costs (50%)
 Candidate: Do we have any information about how
many bottles Bita Beer Company sold in 2015? I
was also wondering what are the total fixed costs?
 Interviewer: Yes, Bita Beer Company sold 80M
bottles last year. And the fixed costs were $20M.

55. PROFITABILITY
 Total cost = $2  80M bottles + $20M = $180M
 Profit = revenue  cost = $200M  $180M =
$20M

56. INSIGHT FROM EXHIBIT II
 Bita Beer Company is a profitable company
 However, the potential profit that our client can
acquire in the next 5 years is $20M  5 =
$100M. Our client cannot break-even in 5
years for the $200M purchase price
 Variable cost, especially storage cost, is the
major cost of the company. If the company
would like to improve its cost structure, that
might be a good starting point.

57. Synergy with
client company
Increase
sales?
Reduce
cost?
Brand value Company
culture
Cannibalization
SYNERGY WITH CLIENT COMPANY

58. SYNERGY WITH CLIENT COMPANY
 Candidate: Since it seems we can potentially
reduce the storage cost, I would like to focus
on that first. I was wondering why is the
storage cost so high?
 Interviewer: That’s a good question. There are
two reasons:
 Bita Beer Company has an outdated storage system.
It requires an investment to upgrade it.
 Bita Beer Company is only a beer brewing company.
There is always a waiting period before transporting
the beer to the retailer, which increases the storage
cost.

59. SYNERGY WITH CLIENT COMPANY
 Candidate: That’s interesting. I was wondering
what is the storage cost of our client and whether
they can help Bita Beer Company to improve it.
 Interviewer: The average storage cost per bottle for
our client is $0.50.
 Our client have recently upgraded its infrastructure
for beer storage. Besides, our client is also a beer
retailer, thus the waiting period is shorter. Actually
our client has estimated the investment associated
with upgrading the infrastructure of Bita Beer
Company. This information can be found in Exhibit
III.

60. EXHIBIT III
Plans Investment
Storage cost
($)/Bottle
Plan A $40M 0.8
Plan B $60M 0.6
Plan C $120M 0.5

61. CALCULATION
Plans ($)Saved/bottle Profit increased/year
Plan A 1  0.8 = 0.2 0.2  80M = 16M
Plan B 1  0.6 = 0.4 0.4  80M = 32M
Plan C 1  0.5 = 0.5 0.5  80M = 40M
Plans
Total additional profit in 5
years
Total investment
Break-
even?
Plan A (20M + 16M)  5 = 180M 200M + 40M = 240M No
Plan
B
(20M + 32M)  5 = 260M 200M + 60M = 260M Yes
Plan
C
(20M + 40M)  5 = 300M
200M + 120M =
320M
No

62. INSIGHTS FROM EXHIBIT III
 Candidate: After the calculation, it seems only
investment plan B will allow our client to
achieve its goal to break-even in 5 years. I
would like to double-check our client’s financial
ability to make sure they can afford the $260M
investment.
 Interviewer: That sounds reasonable. Our client
is doing well in recent years and they can
definitely afford the $260M investment.

63. OTHER FACTORS FOR SYNERGY
 Interviewer: What other factors should our
client consider regarding this acquisition?
 Candidate: That’s a good question. Can I have
one moment to organize my thoughts?

64. OTHER FACTORS FOR SYNERGY
1. Brand value: “low-end” vs. “high-end”
2. Company culture: management style
3. Geographical difference: west coast vs. east
coast
4. Business opportunity in the east coast
5. Potential cannibalization?

65. PREPARE YOUR
RECOMMENDATION

66. RECOMMENDATION
Candidate: I recommend that our client acquires Bita
Beer Company and invests $60M for upgrading its
infrastructure.
1. Bita Beer Company is a profitable company with
leading market share in the west coast.
2. By investing $60M, our client will achieve its goal
to break-even the investment in 5 years.
3. Bita Beer Company owns a premium beer that
can be assimilated into our client’s product line.
This fits our client’s goal for this acquisition.

67. RISKS AND NEXT STEPS
 Risks
 Potentially lose some old Bita Beer Company customers
after the acquisition
 Geographical difference could be a big risk factor
 Next steps
 Increase advertising to ensure customers believe that the
beer quality remains the same after the acquisition
 Set up regular meetings between the two companies to
ensure effective communication
 Evaluate the revenue and cost to produce and sell the
premium beer in the east coast

68. WRITTEN/PRESENTATION
INTERVIEW

69. WRITTEN/PRESENTATION
INTERVIEW
 Format
 Provided a large packet of information/data
 Review individually
 Discuss information with interviewer or organize
slides and present
 What interviewers look for
 Data analysis skills
 Ability to filter and synthesize data
 Presentation skills

70. SUGGESTED PRESENTATION
FORMAT
1. The big conclusion
2. The big conclusion + three supporting reasons
3. Reason 1 + Chart demonstrating Reason 1 (probably
one of the packet slides with your own headline on
the slide)
4. Reason 2 + Chart demonstrating Reason 2
5. Reason 3 + Chart demonstrating Reason 3
6. Re-state conclusion and identify any remaining issues
that might be worth exploring if given sufficient data or
time.
7. Risks and Next Steps

71. GROUP INTERVIEW

72. GROUP INTERVIEW
 Format
 Typically 4-5 candidates in a group
 Answer questions in turn
 Expected to write on a white board
 Ask questions in the end
 What interviewers look for
 Teamwork ability and social skills
 Problem-solving skills
 Presentation skills in a team environment

73. TIPS FOR GROUP INTERVIEWS
 Be a friendly and cooperative team member
 Do not wait for the next question. Be proactive!
 Practice writing on a white board
 Prepare an interesting question in the end