1. Duke APD Consulting Club
Case Practicing
Duke APD Consulting Club
11/11/2018

2. Meeting Agenda Brief review of last meeting Skills for today:
Basic steps for case solving
How to give feedback
Mental math tips
Profitability framework
Skills for today:
Mental math practice
Market size estimation
Sample Case – Framework No.2
Case practice
11/11/2018

3. Meeting Agenda Brief review of last meeting Skills for today:
Basic steps for case solving
How to give feedback
Mental math tips
Profitability framework
Skills for today:
Mental math practice
Market size estimation
Sample Case – Framework No.2
Case practice
11/11/2018

4. Basic steps for case solving
Summarize the case and clarify the objectives
Make hypothesis and develop issue tree
Drill down on each topic
Summarize the results
First five steps:
Summarize the question
Verify the objective(s)
Ask clarifying questions
Label the case and lay out your structure
State your hypothesis
11/11/2018
case in point 8th edition, 4: IVY CASE SYSTEM

5. Time: usually 20 to 30 min. It can be extended for beginners
How to give a feedback
Time: usually 20 to 30 min. It can be extended for beginners
Track down the partners performance during the practicing, where they did good and where they got stuck
Summarize their strong points and weak points
11/11/2018

6. Tips for mental math: Mental math tips
Round up or round down: keep it in mind, you don’t have to be precise, just be accurate enough
Be sensitive to some relations: like 1/4=0.25, 1/6= 0.16, 1/7=0.14 or 0.15, 1/8=0.125, 1/9=0.1
Break it down to several easier parts: 10/6 * 24, 24*25
To avoid unnecessary calculation: 25*40,000 and 65*20,000, which is bigger
Practice more:
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7. Profitability framework
Framework 1: profitability
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Case interview secretes, by Victor Cheng

8. Introduction to Case Practice series
Items to cover:
Mental math,
Market size estimation,
Case interview frameworks,
Basic case interview skills,
Case practice with peers
11/11/2018

9. Meeting Agenda Brief review of last meeting Skills for today:
Basic steps for case solving
How to give feedback
Mental math tips
Profitability framework
Skills for today:
Mental math practice
Market size estimation
Sample Case – Framework No.2
Case practice
11/11/2018

10. Mental math practice
Mental math practice: (1 min, error should be controlled under 20%)
11/11/2018

11. Meeting Agenda Brief review of last meeting Skills for today:
Basic steps for case solving
How to give feedback
Mental math tips
Profitability framework
Skills for today:
Mental math practice
Market size estimation
Sample Case – Framework No.2
Case practice
11/11/2018

12. Market size estimation
Why market size estimation
In interviews, it can be a single question in the first round, or embedded into a case in the following rounds
Clients ask a lot
How to do a market size estimation
Structure: population based, house-hold based, or preposterous types
Assumption: based on common sense, or other evidences
Math: calculation
11/11/2018
CASE IN POINT: Complete Case Interview Preparation, 8th Edition

13. Sample market size question
How many gas stations are there in the U.S.?
Step 1, Structure:
# of cars / # of cars a gas station serve Or
Gas station density * total area of the U.S.
Other structure?
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14. Sample market size question
How many gas stations are there in the U.S.?
Step 2, Assumptions:
# of cars: 320 million of total population; evenly distributed by age; every year-old- person has a car.
# of cars a gas station serves: each gas station has 6 pumps; each pump serves 2 cars at the same time; every 20 minutes a car comes to the pump; cars come mostly between 7:00 am to 7:00 pm; each car has to refuel every month.
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15. Sample market size question
Step 3, Calculation:
# of cars:
Total population = 320 million
Age of population = 200 million (evenly distribution, with the average life expectancy of 80)
# of cars = 200 million
11/11/2018

16. Sample market size question
# of cars a gas station serves:
each gas station has 6 pumps; each pump serves 2 cars at the same time; every 20 minutes a car comes to the pump; cars come mostly between 7:00 am to 7:00 pm; each car has to refuel every month.
Between 7:00 am to 7:00 pm, # of cars served by each pump = 12 hr * 60 min/hr * 1 car/20min * 2 = 70 cars
For 1 month, # of cars served by each pump = 70 car/day * 30 day = 2,000 cars
For each station, # of cars served in 1 month = 2,000 cars/pump * 6 pumps = 12,000 cars
# of gas station = # of cars / # of cars each station serves = 200 M cars / 12,000 cars/station = 19,000 stations ?
11/11/2018

17. Estimation tips Know the imperfection of your estimation;
Segmenting estimates to minimize estimation imperfections;
Solving the sub-estimates via assumptions
11/11/2018
Case interview secretes, by Victor Cheng

18. Estimation tips Imperfection: Fix:
Each year-old-person has a car,
every 20 minutes comes a car to a pump
Fix:
1, find other clues to estimate this value;
House-hold, and the average # of cars in each home?
2, segmenting this portion
According to people’s income, people aged on average has 1/3 car for each, people aged one car each, and for people aged 40-70, 2/3 of them has one car, 1/3 of them has more than one car (let’s say 3).
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19. Summary for market size estimation
Determine and label the question, and lay out the structure:
population-based, household, or preposterous question?
Make assumptions:
The total population/ the total household/ the total area of the U.S….
Do calculation:
Be accurate enough but not necessarily to be precise
11/11/2018

20. Summary for market size estimation
Key numbers to keep in mind:
U.S. population is 320 million
Life expectancy of an American is 80 years
Even distribution between the ages (so there is the same number of 2-year-olds as 72-year-olds. We
100 million U.S. households
11/11/2018
CASE IN POINT: Complete Case Interview Preparation, 8th Edition

21. Meeting Agenda Brief review of last meeting Skills for today:
Basic steps for case solving
How to give feedback
Mental math tips
Profitability framework
Skills for today:
Mental math practice
Market size estimation
Sample Case – Framework No.2
Case practice
11/11/2018

22. Market situation framework
Customer
Product
Who is the customer
What does each customer segment want
Price sensitivity
Distribution channel preference by segment
Customer concentration and power
Nature of product
Commodity of differentiable good
Identify complementary goods
Identify substitutes
Products life cycle
packaging
Company
Competitor
Capabilities and expertise
Distribution channels
Cost structure
Investment cost
Intangibles
Financial situation
Organizational structure
Competitor market share concentration
Competitor behaviors
Best practices
Barriers to entry
Supplier concentration
Regulatory environment
11/11/2018

23. Meeting Agenda Brief review of last meeting Skills for today:
Basic steps for case solving
How to give feedback
Mental math tips
Profitability framework
Skills for today:
Mental math practice
Market size estimation
Sample Case – Framework No.2
Case practice
11/11/2018

24. Sample case
Your client is the CEO of a paint manufacturing company. Our consulting team has previously worked on optimizing their cost structure. The CEO wants to further improve their profitability. How would you analyze the situation?
Industry:
Customer:
Products:
Company:
Competitor:
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25. Case Practicing
11/11/2018