Know more about business

Hi Mohamed,

That's a great question.

There are several things to keep in mind when trying to understand how businesses are run.

Familiarize yourself with the core functions of a business and how they interact, what the typical problems are they are facing, etc.:

• Strategy: Defines the long-term goals and direction to achieve competitive advantage.
• Marketing: Identifies customer needs, promotes products, and drives demand to grow sales.
• Sales: Converts leads into paying customers and generates revenue.
• Operations: Manages day-to-day activities to produce goods or deliver services efficiently.
• Finance: Manages financial resources, budgeting, accounting, and investment decisions.
• Human resources: Recruits, develops, and retains talent while fostering organizational culture.
• Technology/IT: Leverages digital tools and systems to enhance productivity and innovation.
• Customer service: Ensures customer satisfaction and addresses their concerns to build loyalty.
• Legal & compliance: Manages regulatory, legal, and compliance issues to protect the business.

Next could be key financial metrics that are also relevant for case interviews:

• Revenue: The total income generated from sales before any expenses are deducted.
• Cost of goods sold (COGS): The direct costs associated with producing goods or delivering services.
• Gross profit: Revenue minus COGS; measures profitability from core business activities.
• Operating expenses: Costs related to running the business, excluding COGS (e.g., salaries, rent, marketing).
• Net profit: The final profit after all expenses, taxes, and interest are deducted from revenue.
• Profit margin: Net Profit divided by Revenue; shows the percentage of revenue that becomes profit.
• Return on investment (ROI): Measures the efficiency of an investment, calculated as (Net Profit / Investment Cost) × 100.
• Cash flow: The net amount of cash being generated or used by a business during a specific period.
• Break-even point: The sales level at which total revenue equals total costs, resulting in zero profit.

The best way to build your business knowledge is by studying real-world companies and cases:

• Read annual reports of public companies to understand their strategy, challenges, and financials.
• Follow business news (e.g., Wall Street Journal, Financial Times, Bloomberg) to stay updated on market trends and significant business moves that affect all business and specific industries
• Analyze cases from reputable sources like Harvard Business Review and INSEAD Knowledge as well as consulting interview cases (feel free to just read through cases instead of solving them in a peer setting to get more exposure to different problems in a short amount of time).
• Industry analysis: Pick an industry you're interested in and research its market size, key players, competitive landscape, and growth drivers. If you want a shortcut, I have created a 27-page industry primer for my clients which does the work for you.

Also, one final word on case structuring and frameworks (+other parts of the case) since it's such an important topic and often misunderstood:

The key reason why candidates fail their case interviews and don't improve with practice is because they never learn the right approach and techniques to begin with. They might go through 30-40 cases, just repeating the same mistakes over and over again. There is often no strong baseline.

Make sure you understand and learn the basics for each part of the case (structuring, charts, math), which is

• A replicable step-by-step for each part of the case interview

• The right thinking techniques around the individual parts (e.g., what's a framework, what is evaluated, how can I ensure I think about it the correct way, what are some shortcuts to get to the answer quickly, etc.)

• Simple communication templates to help you communicate your insights as well as ask for data in the right way to drive the case forward

There are several approaches you can take, such as hiring a skilled coach, reading the right materials, or enrolling in relevant courses. For example, while some chatbots may suggest a list of books, my book, The 1%: Conquer Your Consulting Case Interview, provides direct guidance tailored to modern case interviews. It covers all the essential points mentioned here, and more, while also offering a detailed preparation plan. You can find it on Amazon

Avoid generic advice and framework memorization approaches. This will only hurt your performance and waste a ton of time (why -> check out the first post here: https://www.preplounge.com/en/consulting-forum/how-goodrelevant-is-the-case-in-point-book-for-case-prep-1984)

Once you have that baseline it's time to practice and internalize the skills to create the right profile, polishing your strengths and lifting your weaknesses to a robust-enough level.

Cheers,

Florian

Good points. The case interview process is an assessment to determine your skill at structuring and problem solving found in typical engagements. Once you're in consulting, for a regular engagement it is expected for all team members to be intimately familiar with the public records of the client (e.g., financial filings, investor day presentations, public statements from both analysts and senior leaders, etc.) This helps understand the motivations, issues, and context that could either hurt / enhance your project. Recommend looking up your favorite public company - undergo the research cited before to get a better sense of the company. A great recent example is GE Vernova - recently spun off from GE and has fantastic investor day materials and video presentations available for the public.