What is Consulting?

Definition: Consulting is the practice of providing expert advice to organizations to help them solve complex
business problems, improve performance, or achieve growth.

Consulting Firms (examples): McKinsey, BCG, Bain (MBB), Big 4 (Deloitte, PwC, EY, KPMG), IQVIA, ZS, LEK,
Accenture etc.

Types of Consulting:
Management Consulting ’ Strategy, operations, growth, restructuring.
Healthcare/Pharma Consulting ’ Market entry, product launches, pricing, R&D pipeline strategy.
IT/Tech Consulting’ Digital transformation, ERP systems.
Financial Consulting’ Risk, M&A, valuations.
 Case Studies
The case is usually a business situation where the client is facing a difficult
problem with the company/product/competitors or is thinking of a new
opportunity to explore and asks you to help address some of the issues.

the case is NOT about finding the right or wrong answer, but rather about the
method you use to derive your answer

A
case study (case interview) is a short, DO's
simulated version of real consulting work. Listen and Interact with the Interviewer.
This is the core of consulting Develop your own framework to structure
interviews. The interviewer gives you a the problem.
business problem; you " Focus on high impact issues.
Clarify " Explore variety of options with creative
Structure thinking.
Analyse " Demonstrate Business Judgement.
Conclude " Make quick and accurate calculations.

DON'Ts
Common case themes " Incorrect interpretation of caseobjectives.
Profitability (why are profits down?) " Jumping straight toconclusions.
Market entry / growth strategy " Not taking time to think,answering in
Pricing &product strategy hurry.
Go-to-market / salesforce / channel " Panicking if theanswer is not
M&A due diligence, synergy sizing apparent.Vehementlydefending your
Ops/ supply chain / cost reduction analysis/suggestions.
" Internalizing the thought process.
Sticking to artificial framework.

Guesstimates are mini-cases that ask you to estimate an unknown number using logic and clear assumptions

Asimple, repeatable approach

1. Clarify scope (geography, segment, B2B/B2C, time frame).
2. Choose a method (top-down via population; bottom-up via usage/frequency; or hybrid).
3. Lay out drivers (e.g., #users x frequency x price).

4. Pick assumptions (state each one).

5. Do the math cleanly (write every step).

6. Sense-check and give a range if useful.

 3C's

Customer Company
Who is the Customer? What is the business?
" Where are they present? Where is it Present?
How do they buy? Scale & Trends?
---.....

Segmentation

Competition

Major Players &Market share

Benchmarking with
Competitors
How is industry doing?

Porter's Five Forces Industry Rivalry Increases with:

Industry "Industry Growth &Number of Competitors
" High Fixed Costs and Barrlers to Extt
Bargaining Power of Buyers increases with:
Rivalry " Lower product differentiation & brand recognition
" Highly Specialised Assets
"Concentration of buyers-higher number of buyers
Bargaining "Lower switching cost for buyer
"Buyer's ability to integrate backward
Power of
" Availability of substitutes
Buyers "High Price Elasticity
" Lower Product Diferentiation Barriers to Entry increase with:
"Lower Impact on Buyer's product Quality "Economies of Scale
Threat of New
" Proprietary Product Differentiation
Entrants (or "Brand Recognition
Barriers to "High Switching Costs for Customers
" Capital Requirements
Bargaining Power of Suppliers increases with
Entry) "Hard to accessdistribution channels
"Regulatory constraínts and restrictions
"Input dIferentiation
" Degree of importance of supplier's product/service
Bargaining -Impact on cost or differentiation
Power of " Lower switching cost for suppliers - lower
importance of volume sold
Suppliers " Lower number of substitutes available - less
supplier Threat ofSubstitutes increases with:
concentration
Threat of .Relatie performance of Substitutes
Substitutes " Lower Switching Costs
" Higher Buyer Propensity to Substitute
 MECE Segmentation
MECE = Mutually Exclusive Collectively Exhaustive

Mutually Exclusive Collectively Exhaustive

Together, the statements

Contents of the segments answer the question or
does not overlap. fully describe the overall
idea.

Using MECE segmentation is extremely effective in structuring one's analysis, in a case interview, guesstimate
or otherwise.

The MECE principle suggests that to understand any large problem, you need to understand your options by
sorting them intocategories. Doing so will help you avoid dependencies between different branches of the
tree and thus sub-problems can be properly isolated

Break down problem into equations.

1. Algebraic Structure Ex: Revenue = No. of customers x Avg ticket price of each
customer x Product mix.

Break down problem into the stages of a process

How to be MECE? 2. Process Structure Ex: Value chain, customer journey,
billing process,purchase process ine-Commerce
There are 5 tools Break down problem into divisions of a particular segment
one can use to be 3. Segmentation Structure Ex: Income (High, Mid, Low income).Distribution
MECE in their channels(Retail, D2C)
cases:
Break down problem by using established frameworks
|4.Conceptual Frameworks . Ex:4P (Product, Price, Place, Promotion).
3C(Customer.Company. Competitor)

|5. Opposite Words Break down problem into inherently opposing words
. Ex: Internal vs. External, Supply vs. Demand, Revenue vs.
Cost

10
 Pareto Principle (80/20Principle)
As per the 80/20 Rule (aka Pareto Principle) a small number of causes (the "vital" or "critical" few) drive
the vast majority of the results, with roughly 20% of the causes driving 80% of the results.
It is a ubiquitous phenomenon with examples across multiple industries:

Manufacturer ~20% of Sales organisation Service facility

the product lines ~20% of the product ~20% of tickets
generate ~80% of categories account for take up ~80% of
scrap ~80% of sales time
....

" The primary implication of this concept is that you can realize a lot of impact by investing your effort in
addressing a relatively small number of issues and hence, prioritizing of issues is important.
The key takeaway from this principle in the context of interviews is that while constructing an issue tree or
making recommendations (using the pyramid principle) one must prioritize the bigger issues by stating
them first.