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Anonymous A

on Aug 23, 2022

Global

Should you include market in a 3C/business strategy analysis?

If I have a case, where a big. global clothing retailer considers entering also the home furniture market: What main categories should I use?

I have customers, competitors, company and synergies. My problem is that I feel that looking at the size of the market itself, both to see the size, the future growth and to see if there actually is a market might deserve its own bucket, but I am also afraid that using that as a separate bucket might make it less MECE. What categories would you use, and where would you put the information about the market?

Also: Would a structure containing customers, competitors, company and market make any sense?

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Sidi

Coach

edited on Aug 23, 2022

McKinsey Senior EM & BCG Consultant | Interviewer at McK & BCG for 7 years | Coached 350+ candidates secure MBB offers

Hi!

Best would be to not structure at all with such “Victor Cheng Buckets”.

"Customer - Competitors - Company" is not a proper structure! It is just an arbitrary selection of areas which might (or not) be relevant. Structuring means to create a logic according to which the question can be answered. So this means getting clearness on

1. What is the objective? And how is it measured (what is the focus metric?)

2. How does this focus metric then translate to a criterion to answer the question “Should we enter the home furniture market?”. Usually this criterion is an inequality.

3. How can the elements of this criterion be quantified (→ broken down into drivers and sub-drivers)?

4. Which influencing factors (→ THESE are your buckets!) do we need to consider to quantify the sub-drivers, and thereby test whether the overall criterion can be met or not

This is what no Case book is reaching you. But this is how in reality, rigorous analysis of such “go or no-go decisions” is done. It allows for a far sharper discussion with an interviewer and, and learning this puts candidates at an enormous advantage during MBB interviews.

Coming back to your question: whether you include “Market” (or any other arbitrary element) into your bucket collection is not really relevant. The fact that you are starting your thinking at this level just shows a lack of rigor which causes immense problems for thousands of candidates who have been branwashed into this kind of thinking by low-quality resources and will hence not even understand why they get rejected.

Cheers, Sidi

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Ian

Coach

edited on Aug 23, 2022

None….

This is overly generic. What does customer mean? What does company mean? Doesn't the market consist of customers? Doesn't it consist of competitors?

To properly framework you need to have an approach to solving the problem - a bunch of words is not it!

I'm wary of providing frameworks without knowing he prompt, but, a general approach for a market entry would be 1) Determining whether the market itself is attractive, then 2) Determining how attractive it is to us (will we do well there), and then finally 3) ensuring that logistically we feel we can properly implement this and succeed better than we could elsewhere

You have some learning to do on frameworking :)

Here's a start: https://www.preplounge.com/en/articles/how-to-shift-your-mindset-to-ace-the-case

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Sophia

Coach

on Aug 23, 2022

Top-Ranked Coach on PrepLounge for 3 years| 6+ years of coaching

Hello,

I agree with Sidi that you should feel free to step away from traditional frameworks and tailor your answer to the question at hand. Having a Market or Industry bucket to talk about size, trends, etc. sounds fine to me. You could also include an operations bucket under which you consider strategies to enter (e.g. partnership/solo, what location), barriers to entry, and so on.

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Pedro

Coach

on Aug 30, 2022

Bain | EY-Parthenon | Private Equity | Market Estimates | Fit Interview

You are not approaching this the right way. “Buckets” are just generic “areas of investigation” instead of decision drivers / questions that you need to answer in order to decide on something.

What you need to think about is on the critical questions that will address / answer the case objective, and then try to organize your thoughts (or “buckets”, if you will) around that. In this case, we are missing some critical input, namely what is the GOAL of the company. If there is no goal, there is no destination, therefore there is no way to get there.

Nevertheless, I feel that the critical issue here would be around how to leverage your specific assets and capabilities in order to enter the home furniture market. Synergies can never be a separate bucket as synergies is the ESSENCE of the question.

This would be a good idea if:
1) Market / target market segments are attractive (relevant size and margins)
2) You can leverage current customers to enter the market (would current customers willing to buy furniture in the same location; for e.g. do you sell textiles)?
3) You can leverage your brand, assets (stores, warehouses), or relationships (production costs) in order to have a price or cost advantage?
4) Your value proposition can be better than the competition for target segments?

This is a simplification. As said, one would need to exact goal and context to prepare a fully MECE and customized approach.

I hope this sheds some light on how to approach cases at a more advanced level.

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Raj

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