Cracking the case interview

A Parivartana Consulting Pvt. Ltd. Initiative

Structure of the workshop
2

Session # Title Duration

1 Introduction, Solving Guestimates And Market Sizing Cases 90 mins
2 Growth Strategy / Revenue Enhancement Cases 60 mins
3 Profitability / Cost Reduction Cases 60 mins
4 Customer Satisfaction/ Loyalty 60 mins

What you’ll learn

✓ How to crack all manner of case studies including: Market Sizing, Profitability etc.
✓ Multiple frameworks to help you structure your thinking in a case interview
✓ All the business and consulting terminology necessary in a case interview
✓ How a case interview is conducted through interactive case interview examples
✓ Tips to help when preparing for online case interviews

Private & Confidential August 21

Session#1: Agenda
4

1 What is case interview?

2 Why do companies take case interview?

3 Typical flow of a case interview

4 Different parts & progression of a case interview

5 Types of case studies

6 Guestimates and market size estimation cases

Private & Confidential August 21

What is case interview?
5

• Solve a broad business problem that is analogues to a real-life concern of a

company

• E.g.,
• Should a Finnish mobile manufacturing company enter Indian market?
• How should airline price the flights on a particular route?
• In what ways can FMCG company improve the revenue of a particular brand?
• What should a steel manufacturer do to improve its profitability?

• In real-world, consultants will take months to solve these problems. You are expected
to solve in a 30-min or 1-hour case interview

Hence, APPROACH is far more important than the final solution!

Private & Confidential August 21

Why do companies take case interview?
6

Clear & effective Problem

communication solving
skills
Companies following case
interview approach:

✓ Strategy consulting firms

Testing core ✓ Leading tech firms
Logical strategy skills – Quantitative ✓ Conglomerates for Corp Strategy/
thinking all at once ! skills General management roles
style ✓ Data and analytics firms

Business
acumen

Private & Confidential August 21

Typical flow of a case interview
7

INTERVIEWER: YOU: YOU:

Presents background, problem Synthesize major points of the Request time to structure your
and objectives of the case case and verify objectives thoughts into a framework
(understanding the case (Verifying objectives) (Developing a structured
background information) framework)

YOU + INTERVIEWER YOU + INTERVIEWER YOU:

Gather assumptions to solve Interviewer reviews your Present the framework to the
the quantitative problem framework, suggests the area to interviewer
(Quantitative skills) start with OR you’ll be expected (Presentation &
to suggest (Start the case) communication)

YOU + INTERVIEWER YOU + INTERVIEWER YOU

Solve qualitative questions on The interviewer will ask you to Differentiate yourself with
business judgement/ intuition summarize/ provide final additional insights/ ability to see
(Logical thinking style) recommendations a larger picture
(Delivering a conclusion) (Taking it forward)
Private & Confidential August 21
Different parts & progression of a case interview
8

1 Understanding the case background information

• Listen to the problem statement carefully

• Note down the key information (about industry, company, customer, market, pain
points)
• Ask question if not clear

2 Verifying objectives

• Take a moment to consume the information provided

• Summarize the case background and objective to the interviewer
• Ask the interviewer if your understanding is correct or not

Private & Confidential August 21

Different parts & progression of a case interview
9

3 Developing a structured framework

• Analyze the problem statement and think about an approach/ framework to solve in a
structured manner
• You may leverage the standard frameworks like Ansoff matrix, BCG matrix, Porter’s
framework, 3C framework etc. (only if they are directly applicable)

4 Present your framework/ structure/ approach

• Share your thought process (or framework) with the interviewer before starting to solve
the case. Explain your rationale.
• Demonstrate your overall approach to solve all aspects of the problem at hand
• Ask the interviewer if your approach is correct and whether you are missing any
aspects
Private & Confidential August 21
Different parts & progression of a case interview
10

5 Solve the case

• Take 2-4 mins to build your solution/approach in line with the framework
• Narrate the solution/ approach to the interviewer

6 Quantitative skills

• Share your assumptions and calculation methodology with the interviewer

• Ask the relevant questions and seek the required data
• It will be ideal if you speak your math out loud
• Think how best can you triangulate your result

Private & Confidential August 21

Different parts & progression of a case interview
11

7 Qualitative question solving (logical thinking)

• For the qualitative parts of the case (e.g., competitive analysis, industry analysis,
customer response etc.), leverage your industry expertise and/or business acumen
• Out of the box thinking is always appreciated

8 Delivering a conclusion

• Share your conclusion with rationale to the interviewer

• Many a times, this is followed by a subsequent twister – Do not outrightly negate your
solution. Rather, think how best can you further improve your solution given the
additional information

Private & Confidential August 21

Types of cases
12

# TYPE SUB-TYPE

1 Guestimates Top-down, bottom-up, mixed

2 Market size estimation Top-down, bottom-up, mixed

Revenue acceleration, business diversification, Acquisition,
3 Growth Strategy
market share improvement, market-entry strategy
4 Profitability Cost reduction, Pricing strategy
Customer experience enhancement, Loyalty improvement, churn
5 Customer satisfaction
reduction, Brand advocacy improvement, NPS improvement
Go-to-market strategy, Pricing strategy, Promotion strategy,
6 Marketing
Marketing channel mix, Campaign effectiveness
Network optimization, Logistics cost optimization, warehousing
7 Supply chain/ Operations
and distribution, supplier rationalization

Private & Confidential August 21

Tips for solving case studies during the interview
13

✓ There are no correct answers: The aim is to be logical

✓ Don’t tie yourself in knots: round-up/ down the numbers whenever
possible
✓ Write it down: Do not treat the piece of paper as a rough calculation
sheet
✓ Speak up: The time you speak for should always be greater than the
time you spend calculating

Private & Confidential August 21

 14

1. GUESTIMATES

Private & Confidential August 21

1. What are guestimate case studies?
15

Guesstimate questions in interviews ask the candidate to estimate a number based on

very limited information (hence “guess”)

Top-down Bottom-up
Questions that involve starting with an entire Start from the “bottom”—some low-level
population (in other words, the “top” level) and statistic, such as Revenue per customer,
then breaking it down until you arrive at an answer and build your way up to the answer

Example guesstimate questions:

•How many mattresses are sold in India every year? (Top-down)
•What is the monthly profit of your favorite restaurant? (Bottom-up)
•How many bottles of coca-cola are there in circulation in India now? (Top-down)
•How many weddings are performed in India per year? (Top-down)
•How many flights have a lay-over at Dubai Airport in year? (Bottom-up)
•What would be the revenue of a Lakme Hair Salon in South Delhi? (Bottom-up)

Private & Confidential August 21

 16

Solving a case study

GUESSTIMATE CASE #1

Private & Confidential August 21

Guestimate Case #1
How many cups of tea is consumed in Mumbai per month?
Step 1: Clarify the question

Step 2: Inform the interviewer about your thought process (Assumption and approach)

Approach :
• Break down the monthly consumption into weekly consumption;
• Divide the population by types of tea-drinking pattern (Habitual, Regular, Occasional and
none);
• Determine the per week consumption for different types of tea-drinkers
Key Assumptions to start with:
• Same consumption on all days of the week;
• Mumbai population is ~2 Cr

Private & Confidential August 21

 Guestimate Case #1
How many cups of tea is consumed in Mumbai per month?
Step 3: Build on the approach

Mumbai Population : 2Cr

Eliminating children, who are ~10% of
the population

Addressable population: 1.8Cr

Habitual drinkers (25%) Regular drinker (40%) Occasional drinkers Non-Tea drinker
~2 cups per day i.e., 14 1 cup per day i.e., 7 (25%) (10%)
cups per week cups per week 2 cups per week 0 cups per week

Tea-cups 1.8*25%*14 1.8*40%*7 1.8*25%*2

consumed per = 0.45*14 = 0.72*7 = 0.45*2
week = 6.3 Cr = 5.04 Cr = 0.9 Cr

Total tea-cups [6.3+5.04+0.9] * 4 = 12.24 * 4 = 48.96Cr = ~49 Cr

consumed per
month
Private & Confidential August 21
 19

Solving a case study

GUESSTIMATE CASE #2

Private & Confidential August 21

Guestimate Case #2
Estimate the profit of your favorite restaurant in your city
Step 1: Clarify the question

Step 2: Inform the interviewer about your thought process (Assumption and approach)

Clarify the context and scope

• Tell a few facts about your favorite restaurant to build the scope
• Shivsagar Restaurant : family dining place in the suburb
• Operates 4 hours in the morning and 4 hours in the evening
• Serves veg food and non-alcoholic beverages
• Considering only dine-in side of the business (Ask the interviewer if he/she is ok with this assumption)
Approach :
• Determine monthly revenue based on per customer invoice amount and capacity utilization
• Determine monthly cost : fixed cost and variable cost
• Estimate operating profit before tax, depreciation and amortization (Ask the interviewer if he/she is ok
with this understanding)

Private & Confidential August 21

Guestimate Case #2
Estimate the profit of your favorite restaurant in your city
Step 3: Calculate the revenue
Revenue per week = number of tables * number of customers per table per week *
revenue per customer

Number of tables: 20 (you know it! It’s your favorite restaurant)

Number of customers per table per week:
Weekdays (Monday lunch to Friday lunch) i.e. 9 Weekend (Friday dinner to Sunday dinner) i.e. 5
slots of 4 hours each slots of 4 hours each
• Utilization : 50% • Utilization : 100%
• Hours per customer : 1 hour • Hours per customer : 1 hour
• Total customers per table = 9*4*50% / 1= 18 • Total customers per table = 5*4*100% / 1 = 20

Revenue per customer : INR 2,000 (assumption)

Revenue per week = 20* (18+20)* 2000 = INR15,20,000

Revenue per month = INR 60,80,000
Private & Confidential August 21
Guestimate Case #2
Estimate the profit of your favorite restaurant in your city
Step 4: Calculate the cost
Total cost per month = Fixed cost + (Variable cost per customer * total customers per month)

Fixed cost = Rent + Utilities + Salary of staff + License & Insurance

Staff break-up = Chefs + Waiters + Cleaners + Admin/cashier
= (3*75,000) + (8*20,000) + (3*8,000) + (1*15,000) = INR 4,24,000

Fixed cost = 300,000 + 30,000 + 4,24,000 + 11,000 = INR 7,65,000

Variable cost = Raw material
Assumption : Food raw material is ~50% of the price of the dish
Total variable cost per month
= (Revenue per customer * 50%) * number of customers served per month
= (2000 * 50%) * ((18+20)*20*4)
= 1000 * 3040 = INR 30,40,000

Total cost per month = INR 38,05,000

Private & Confidential August 21
Guestimate Case #2
Estimate the profit of your favorite restaurant in your city
Step 4: Calculate the Profit
Operating profit per month = Revenue – (Fixed Cost + Variable Cost)
= 60,80,000 – 38,05,000
= INR 22,75,000
Annual operating profit = INR 2.73 Cr

Step 5: Share further information around how will you calculate the net profit
• Estimate the capital expenditure and potential debt
• Determine the interest, depreciation and taxes
• Estimate the net profit
• If the capex is funded through own money, we can calculate ROI and break-even period

Private & Confidential August 21

 24

2. MARKET SIZING CASES

Private & Confidential August 21

1. What are market sizing studies?
25

Estimate the market size (e.g: “annual sales”) of a certain product, often using limited
information.

B2C B2B
Focuses on estimating the number of Involves identifying the end-use sectors
customers/ users and then estimating the and relevant markets followed by
consumption per user estimating the demand per sector and
market

Example guesstimate questions:

• What is the market size of pressure cookers in India?
• What is your estimate of electric 2W market in your city?
• What is the market size of steel rods in India?
• How big is the market for online gaming apps in India?
• What could be the market size for organized tea chains in India?

Private & Confidential August 21

 26

Solving a case study

MARKET SIZING CASE #1

Private & Confidential August 21

Market sizing case #1
27

What is the market size for online eye-glasses market in India?

Step 1: Clarify the question

Step 2: Inform the interviewer about your thought process (Assumption and approach)

Clarify the context, assumptions and scope

• Eye-glasses for this case are only with powered lenses
• Sunglasses, fashion accessories are not considered in the scope (Ask the interviewer if
he/she is ok with this assumption)
Approach :
• Determine the population which would use eye-glasses
• Estimate the consumption per year per customer to determine the total units sold
• Estimate annual sales by multiplying the average price of the eye-glasses
• Estimate the share of customers adopting online purchases in eye-glasses category

Private & Confidential August 21

Market sizing case #1
28

What is the market size for online eye-glasses market in India?

Step 3: Start solving the case Total Population : 1.4 Bn

Age 0-20 (25%) Age 21-60 (50%) Age 60+ (25%)

Population (Mn) 350 700 350

% people wearing eye-glasses 10% 50% 100%
# people wearing eye-glasses (Mn) 35 350 350
Eye-glasses replenishment cycle 2 years 4 years 5 years
% of online adopters 1% 5% 0%
Avg price of eye-glasses (INR) 2000 4000 5000
Online annual sales of eye-glasses =(35/2)*1%*2000 = =(350/4)*5%*4000 =(350/5)*0%*5000
(INR Mn) 350 =17,500 =0
Online Eye-glasses market size (INR Cr) 35 1,750 0

Total market size = INR 1,785 Cr

Private & Confidential August 21
Market sizing case #1
29

What is the market size for online eye-glasses market in India?

Step 4: Share further insights to demonstrate your ability to see a larger picture

This market size is expected to grow as the penetration of ecommerce in eye-glasses

segment increases. Factors fueling this penetration –
• Smartphone usage
• Penetration of ecommerce companies in Tier 3 cities
• AR/ VR enablement in smartphones

Ask the interviewer if he/she wants you to calculate sunglasses market as well.

Private & Confidential August 21

 30

Solving a case study

MARKET SIZING CASE #2

Private & Confidential August 21

Market sizing case #2
31

Our client is a leading lithium-ion battery manufacturer in Japan. They

want to enter Indian market and have hired you to estimate the market
size in India.
Step 1: Clarify the problem statement and ask any additional questions you may have
• Lithium-ion battery has applications in multiple end use sectors. What are the end-use
sectors the client is operating in? – Automotive
• Do they want to stick to the same sectors in Indian market? - Yes

Step 2: Inform the interviewer about your thought process (Assumption and approach)
Approach :
• Estimate the # batteries required by auto manufacturers – 2W, 4W, commercial vehicles
• Estimate the demand in after-sales market

Note: In B2B market sizing case, you may need multiple datapoints which you can not guess like
population of India. Ask for these datapoints at the relevant stage in the calculation

Private & Confidential August 21

Market sizing case #2
32

Lithium-ion battery market size for automotive sector in India

Step 3: Start solving the case

Total Battery consumption

New vehicles Old vehicles

• Data required: • Data required:

• Annual production of 4W, 2W and CV • Number of 4W, 2W and CV on the road
• Cost of a battery per type of vehicle • After-market price of the battery per type of
• # of batteries consumed will be same as the vehicle
production • Assumptions/ Data required:
• Avg life of a battery for 4W, 2W and CV
• Battery consumption per year per type of vehicle =
Number of vehicles on road / avg lifespan of the battery

Note: Interviewer may handover the data to you in the form of tables/ graphs as case appendix OR
can provide you the datapoints verbally.
Private & Confidential August 21
Market sizing case #2
33

Lithium-ion battery market size for automotive sector in India

Appendix A :
Automobile
production trends

Appendix B : Type 4W 2W CV
Battery details Avg wholesale price 4,700 2,600 6,500

Avg retail price 6,000 3,500 8,000

Avg lifespan 4 years 5 years 3 years

Private & Confidential August 21

Market sizing case #2
34

Lithium-ion battery market size for automotive sector in India

Key Assumptions to validate with interviewer
• For simplicity, we are assuming that the production is equal to sales
• Average lifespan of the vehicle is 10 years. Thus, total vehicles on the road will be twice the
cumulative sale of last 5 years
• New car batteries are purchased by auto manufacturer. Hence, they will buy it at wholesale price
• Old car batteries are purchased by individuals. Hence, they will buy it at a retail price
• Other types of vehicles are not considered in the scope at this moment

Homework : Please calculate the market size and verify with your friend

Private & Confidential August 21

Market sizing case #2
35

Lithium-ion battery market size for automotive sector in India

Step 4: Share further insights to demonstrate your ability to see a larger picture

This market size can be divided into addressable vs non-addressable market for the Client
based on following factors –
1. Eliminating the demand of auto manufacturers who have in-house battery manufacturing
2. Any specific requirements from the vehicle manufacturers restricting the usage of third-
party batteries in after-sales
3. Battery distribution network in the after-sales

Private & Confidential August 21

 36
36

Q&A

Private & Confidential August 21

Next session
37

Growth Strategy/ Revenue enhancement cases

Private & Confidential August 21