CraftingCases: Hypothesis Testing (Case Interview Fundamentals Course)?

Hi there,

I would be happy to share my thoughts on your question:

• First of all, I would advise you not to focus too much on CraftingCases (or any other theoretical resource) for developing your initial structure. While they might sound good on paper, in most interview situations, you simply don’t have the time to follow such elaborate methodologies.
• Moreover, I would advise you to consider working with an experienced coach like me on this. I developed the “Case Structuring Program” to help exactly such candidates like you who struggle with properly structuring any case study.

You can find more on this topic here: How to succeed in the final interview round.

If you would like a more detailed discussion on how to best prepare for your upcoming interviews, please don't hesitate to contact me directly.

Best,

Hagen

Hey! Actually, I also had a look at Crafting Cases before my interview prep some years ago :) 

In hypothesis-driven problem-solving, like the example you mentioned from the CraftingCases course, using a structured framework helps you break down the problem logically. The "cause, effect, consequence" framework is a way to systematically address a question, helping you articulate your thinking and ensure you're exploring relevant factors.

Here's how you could approach the "make or buy" question using the cause, effect, consequence framework:

1. Hypothesis:

The question asks if it would make sense for Oracle to buy SoftSales or develop its own product (make). Your initial hypothesis could be: "Oracle should buy SoftSales because it would be faster and cheaper than developing a new product."

2. Cause: Why might this be true or not true? (Analyze the key drivers)

• Cause 1: Speed:
  • Buying SoftSales might allow Oracle to bring a product to market faster.
  • Developing in-house might take longer due to R&D, testing, etc.
• Cause 2: Cost:
  • The cost of acquiring SoftSales versus developing a similar product (consider acquisition price vs. development costs, opportunity cost, etc.).
• Cause 3: Synergies:
  • How well SoftSales’ product integrate with Oracle’s existing offerings (potential synergies or duplication of efforts).
  • Compare synergies from buying SoftSales with the potential advantages of making their own product.

3. Effect: What would the impact of each cause be?

• Effect 1 (Speed):
  • Buying SoftSales allows Oracle to gain market share more quickly, which could lead to a competitive advantage.
  • Delays in developing in-house could result in missed opportunities or falling behind competitors.
• Effect 2 (Cost):
  • If buying SoftSales is cheaper (due to lower R&D costs or quicker return on investment), it could be more attractive.
  • On the other hand, if SoftSales is too expensive, in-house development could be a better long-term solution.
• Effect 3 (Synergies):
  • Better integration with Oracle’s existing products could lead to enhanced value for customers, while making their own could offer more control and customization.

4. Consequence: What does this mean for the overall decision?

• If buying SoftSales is faster, cheaper, and provides better integration, the consequence is that buying makes more sense.
• If the opposite is true (e.g., SoftSales is too expensive or doesn't integrate well), the consequence might lead to developing in-house.

In Short:

You break down the initial hypothesis (buy vs. make) by looking at causes (speed, cost, synergies), then think through their effects on Oracle’s goals, and finally derive the consequences to make a decision. This approach ensures you're logically progressing through the problem, analyzing each step, and justifying your conclusion.

In this case, when the interviewer asks "how would you figure that out?", you'd walk them through the analysis:

• "First, I'd compare the speed of entering the market through acquisition versus development."
• "Next, I'd evaluate the cost of both options, including R&D for in-house development and the acquisition price of SoftSales."
• "Finally, I'd assess how well SoftSales' product integrates with Oracle’s offerings and whether developing their own would offer more strategic control."

Hope this helps!

BR Alessa

Hello there,

Your specific question has been addressed and I thought to add a note on using Crafting Cases.

I studied the course a while ago and it’s a really great resource to get under the hood of a lot of structuring techniques. However, there are 3 risks you need to be on the lookout for:

1. Verbosity: Based on their approach, you could end up using a lot of words to express points that could be stated more concisely  
2. Loss of time: Their optimization for rigour over pragmatism in every exercise / sub exercise could waste precious time especially in smaller exercises in the middle of a case (e.g. brainstorming)
3. Tendency to come across as robotic: This is more of a consequence of point 2 (so not perfectly MECE 🙂). When you spend a lot of time on smaller exercises just to be structured, it could dampen your fluidity when conversing with the interviewer

Feel free to reach out for a brief chat if you have any specific questions on how best to use the course.

Fathu

Honestly... the structure should be: "compare the 2 options" on the "decision drivers".

You have 3 decision drivers:

• Time to Market
• Quality
• Cost

[I'm using their content here... You could think about a few more drivers... Differentiation, development costs for further versions, capability preservation, etc.]

You have 2 options: 

• "DYI"
• "Outsource". 

Approach is to compare the 2 options on the 3 decision drivers.

They have a structure... but they don't have an approach nor are solving the problem. It is completely artificial and as such... useless at best.