Case Question on setting up the problem (Interviewer led)

Question

Your client ABC Co. sells widgets in the North American market but the last few years have been tough. Profitability of the company has been declining and morale is flagging. They’ve brought you in to help identify and address the core issue. How would you approach this?

For the above case I have put together a basic structure below. My question is here they have mentioned 2 key areas: Profitability of the company has been declining AND morale is flagging. So would the below structure be appropriate or is it advisable to check with interviewer on which one they want to focus on?

A. Internal Financial Performance (Profitability)

Revenue Analysis
- Quantity: Are customers buying fewer widgets? Has the customer mix shifted?
- Pricing & Value Proposition: Are pricing pressures reducing margins? Is the value communicated effectively?
- Sales & Distribution Channels: How effective are current channels? Is there a need to optimize or diversify?
Cost Structure Analysis
- Fixed Costs: Are fixed costs too high?
  Variable Costs: Have variable costs increased?

B. Organizational Health & Employee Morale

Leadership and Culture
- Management Style & Communication: Are leaders effectively motivating and engaging teams?
- Incentive Systems through pay: Do compensation and advancement opportunities align with performance given fall in profitability
Employee Engagement & Productivity
- Work Environment & Job Satisfaction: What are the key drivers behind flagging morale?
- Training, Feedback, and Empowerment: Is there sufficient support and clear pathways for professional growth?

C. External Market & Competitive Environment

Market Dynamics & Customer Trends
- Competitive Landscape: How has competition evolved? Are new entrants disrupting the market?
- Changing Consumer Behavior: Are shifts in consumer preferences impacting widget demand?
Macro-Economic & Regulatory Factors
- Economic Environment: Are broader economic trends (e.g., recession, inflation) affecting sales?
- Regulatory Changes: Have any new policies or regulations impacted market access?

Answer 1

Hello there,

Great question! To solve your doubt related to the additional structure, you have to confirm if the reason behind the drop in morale is related to the profitability. If it is, there is no need to create an secondary issue tree for the organization, since by solving for profits you would be solving for the cultural issue as well.
Clarifying questions are always very important to make sure you are focusing on the correct problem and limiting your scope to what matters.

Good luck with your studies and feel free to reach out if you think you could be benefited by professional guidance :) DM me for a 15 to 20 alignment call free of charge.
Best,

Mari