What are Case Interview Frameworks?

Firstly we are going to start with the basics: what are case interview frameworks?

There are multiple ways a business might approach its challenges and solve them based on its peculiarities and how the problem is viewed. The case interview framework can be referred to as solving business problems using a defined structure. Breaking down the issue of challenging a business into its fundamental pieces, the minimum problem to be solved using the framework’s structure can also be considered a case interview framework. 

Generally, an existing framework is proven to be an effective and widely accepted form of solving business problems. The two categories of the case interview framework that exists include custom bespoke framework and preexisting framework. Also, the case interview framework is considered the most critical component of a case interview. Therefore, it could make or mar the success of solving the challenges faced by the organization. Implementing an outstanding case framework can easily set up your business challenges for ultimate success; however, a flawed framework can easily undermine your effective effort while solving a business challenge. 

The two categories mentioned above would be covered in detail in this piece. At the same time, the preexisting framework would be explored first as this is a well-known business framework. You might be aware of some of this framework already, while some might be new to you as an individual. Here is some of the preexisting case interview framework that would be explored in this piece. 

• Profitability framework
• 4Ps framework
• Porter’s five forces
• 3Cs framework 
• Market entry framework
• New Product framework

It is best to create a unique framework for any situation you encounter in business analysis as a candidate. This would help you gain better recognition by employers rather than memorizing any business case framework. You shouldn’t force lift these business frameworks in your case interview but then have a structured thought around the existing frameworks and efficiently solve the problems you are presented with. 

Profitability framework

The most basic framework you can implement in business analysis is the profitability framework. This framework is commonly used to quickly identify any profitability issue a business is suffering from and correct any challenges. This framework simply breaks down the profit structure of any business into cost components and the primary revenue stream of the said business. Indeed, a business goal is to maximize its potential by increasing profits through increased revenue and minimizing cost at all points. Even government institutions might have profit increase as their primary organizational goals. With that being said, profit increase is one of the objectives in consulting case study interviews. Besides, understanding how to analyze the components of a business that comes together to form a business profit system is imperative to the success of any aspiring consultant or candidate. The framework for the profitability of any business model is broken down into revenue and cost. You aim to understand the bigger picture of how the business functions and derives its profits before digging deep into the components of the business and its specifics. Also, there might be scenarios where you are tempted to reduce cost and increase revenue; however, there are only a few cases where you might be presented with such instances. 

• Revenue: this can simply be referred to as the number of units sold by the business times the price per unit. It made up the revenue stream of a business. 
• Cost can be considered both Fixed cost and variable cost incurred by a business during the production process of a product or service. A variable cost can then be broken down into cost per unit and the number of units produced.

The 4Ps framework.

This framework is implemented mainly by organizations directors and executives for designing a robust marketing strategy for their organization. This framework, however, has different variations and implementation processes. Sometimes it can be referred to as a marketing mix, while the 4Ps is the most commonly used framework. In general, the framework is mainly used to review an existing product position and implemented for launching a new product. 

• The product: Certain questions must be answered depending on the products, providing a clearer picture. Such questions can include what are the characteristics of the product to be sold? What is the value proportion of the product? How does the product benefit the buyers? Some other key elements that must be considered regarding the product can include what need the product fulfills for the customer. The product life cycle must also be put into consideration whenever you are implementing this framework. Finally, competing products, alternatives, substitutes, and other factors relating to the product must be thoroughly examined. 
• Price: This is another determining factor in the 4Ps framework. At what price should the product be sold for in the open market? Again, different considerations must be analyzed when setting the price for a product. Some reviews include the customer’s perception of the product value, the price of the existing products in the market, the cost of production, and many more. 
• Promotion: majorly, a product is meant for the customer to consume; however, promotions must be made to provide visibility to the product and its brand. The product’s unique selling point, which promotion strategies are best for the product, would be considered here. Also, some key elements would need to be considered for product promotion, including the media that will be used (either digital media or traditional media), the promotional messages, the possible time to promote the product, and many more.
• Place: This section holds information about the channel of distribution for the product. The critical consideration here is how the product will be distributed through a physical store, web, mail, or other means. The customer’s expectation regarding the best channel that should be utilized for distribution should also not be left out. 

Porter’s five forces

The framework is explored mainly by CEOs to understand the competitiveness of the industry their business falls into. Indeed, not all business industries are structured the same way as the others; however, understanding the industry a business belongs to help. Although some industries are complicated to understand and break into, for example, the banking industry, some industries have low entry barriers, such as newspaper publications. .meanwhile, as a product supplier, you have viable bargaining power in some cases, such as security equipment sales. In contrast, the power isn’t significant for readily available consumer goods, say clothes. Generally, understanding the concept of any industry you aim to break into as a business is essential. This would give you an edge when accessing the competitive nature of the industry and how your product can find its way in. The porters five forces include

• The bargaining power of the customers: Here, the consideration is based on how much bargaining power the customer has in the market? If there are multiple suppliers and one buyer, then the buyer is at an advantage. Other elements you must consider include customer concentration, the sensitivity of the customers to price changes, information available at the customer’s disposal, and many more elements. 
• The supplier bargain power: This comes into play when there are multiple buyers but limited suppliers. Here how much bargaining power does the supplier have? Also, the more the buyer and the less the supplier, the more the supplier is at an advantage. Some of the critical considerations that must be referred to include the present concentration of the suppliers in the market, the difficulty customers face from switching from one supplier to another, the primary differentiation between supplier A’s product and supplier B’s product. 
• The availability of substitutes: Another consideration should be the availability of substitutes in the market and the popularity those substitutes have gotten over time. As a short explanation, water is an excellent substitute for soft drinks such as coke. At the same time, Pepsi has become a formidable competitive product for coke in the open market. The key factors to be considered in this section is the possibility of a new substitute, the change in customers taste, the purchasing of the customers, and many more.
• The threat to new entrants: Here, the consideration is centered on how difficult it would be for new industry players in the market. You are to consider the possibility of regulation authority, network effects, scales’ economics, and others. 
• Exiting competitors: How competitive are the market and the existing players in the market? The key factors here are based on the number of competitors available in the market, the market shares, the similarities between the products, and the healthy competition. 

The 3 Cs Business situation frameworks,

The 3C’s and business situation framework overlaps in different categories, and they will be explored in this section. Here, the case interview framework depends on the broad business categories of the client’s problem’s sources. This framework is used to put together working strategies for organizations. Here there are a lot of components of the business that will overlap with Porter’s five forces. The business situation framework, coined by Victor Cheng, adds Products as an additional category.

• The customers: here, you should know who your customer is, who your target audience is and who you aim to sell to. Besides, you should know the customers’ demographics, age, sex, orientation, color, and background. You would need to study how the customers are segmented and the performance over the years. The growth of each segment of the business must also be examined as this affects the performance of the business. Additionally, the distribution channel that would be used to reach the business customers must be clearly defined. Besides, you should analyze the potential projected growth here also. 
• Competitions: What is the competitive dynamic of the business? Here, the factors considered include the competitor’s value proportion and how the competition can affect your products. The competitors’ market share and the growth of the industry here also come into play. In general, the competitor’s financial health should not be neglected. 
• The company: Here, the value proposition and what defines the company is considered. Here what are the company’s competencies? How long has the company been existing? What are the financial capabilities of the company in the past years? What is the management culture of the company? How formidable is the organization’s brand?
• The product: what is the difference between the new product and the ones in the market? Is the product innovative enough? Is the market big enough to entertain the product and follow the shift it creates?

The market entry framework

Companies often need to diversify into the new market to grow their business. This can be an exciting journey for the business; however, the organization must thread consciously. This is also exciting because the new market represents a new opportunity. Of course, there are new challenges to be faced by the business. The case study interview should then focus on the categories of questions used to measure the range of possibilities to be enjoyed by the business. The market entry framework is implemented to study the business performance when entering a new market. The market, the client capabilities, and the entry strategy would be used to capture the market. 

• The situation of the market: here, you would want to know the market size. The market size is a determining factor in the success of the business in the new industry. Is the market growing or declining, and at what index is the growth or decline. The index must be viewed based on the previous years before and the projected years to come. More so, the market lifecycle should be considered as well. Who are the market customers, and what categories or segments do the customers fall into? Besides, the case interview should check if the market has undergone many changes in recent times. 
• The client’s capabilities: Here, the client has to examine its capabilities to enter a new market. Also, the business has to consider the differences between the client’s current industry and the news industry the client is hoping to venture into. Besides, the number of times the client has entered a new market must also be considered. Other companies in the industry the clients are targeting, and many more capacities must be examined. 
• The entry strategies: Here are their barriers to entry and how those barriers could be solved. Would the new market be more profitable than the existing one? Would it be best to acquire an existing business or through a joint venture or create the business from the ground up? Aside from this, the business must also have a strategy of how it would exit the industry if the business isn’t going as planned. The entry speed should also be determined, and the timing of entry should not be left unconsidered. 
• Financials: Here is another major important factor determining the business’s success in the new market. Does the new industry make financial sense to enter it? Also, the current economic situation of the client must be strongly considered. More so, the cost of entering a new market and the running cost that would be incurred during the entry should be accounted for. In addition, expected return on investment and other financial projections must be appropriately accounted for. 

The new product framework

This is also similar to the new market entry framework. Companies need to develop new products to help keep in business and grow their business. The problem such a business might encounter is how to break into the new market and have the product acceptable to the customers. This problem is very challenging for most businesses. A major fear is a cost of producing the product breaking into the market; The fear of the unknown also comes into play; however, you can dive deep into the new product’s potential. 

The potential of the new product framework categories can have the following question to help refine the perception of the framework. 

• New product and the product details: How is the latest product different from the current market, and what does the new product entail? What is the latest product’s innovation compared to the ones that are available in the market? Besides, is the product under any patent, or can it be freely copied in the market? Is there any substitute to the product in the market, and what the available substitutes are? Typically, how the product fits into the client’s production line should also be examined thoroughly. Besides, can the product be bundled with any existing product in the market which can then serve as a pair?
• Market Strategy: The market entry strategy for a new product must ultimately be considered ideally. How does the product aim to expand the client base of the business? Does the business have another product that can pair with the new product entering the market? Third, who are the leading competitors, and how much market share does each firm have? How the competitors would respond to the new product the business is introducing into the market. Finally, who are the targeted customers, and the new product aims to reach out to them?
• Feasibility: the success of the new product is determined by the possible result it provides the business. Here how much funding is required to promote the new product? Where does the funding come from? If the new product would be serviced by debt, does the business support the debt? Does the client have the manufacturing or production capabilities to produce this product independently, or does it need help from other parties? Does the business have an existing relationship with suitable suppliers that will help the business market the product? How will the new product impact the business profitability? Besides, does the new product potentially displace other existing products in the market and take the lead easily?

Learning to create your unique framework

A good case interview framework is a bit tailored made to solve some problems that are exciting and particular to the problems your business is solving. The industry your business exists in also matters to the framework you would be implementing. If you are a pre-defined framework, you might miss some essential elements of the solutions you are supposed to implement. Besides, this would mean that you would perform lower than you could have created to approach the specific problem peculiar to that business. 

In real-life scenarios, consultants rarely used the pre-defined framework for business challenges. Although being familiar with the framework is essential as it helps the consultant formulate a better solution that works effectively for the business’s challenges. Instead of creating a new framework to solve specific business problems, they are trying to solve for business, modify the existing framework to suit the challenges works better, and it’s much appreciated in the consulting world. However, to scale through this implementation process, the conversation is based on the client’s experience and how the industry has changed over time.

Effectively solving a problem might be intimidating, but the bright side holds the excellent news of creating a bespoke framework that fits the challenges alone. This is because there is no one size fits all rule in the business world. With that being said, some requirements can help you develop a new framework that solves challenges. Here are the key points to consider:

• Change your framework approach from modifying the framework to creating a better solution framework from the ground up. 
• Learn step-by-step methods of how you can create a solution framework for business problems.
• Practice those steps you have created and implement multiple examples of how those solutions would work.

In providing solutions to business challenges creating a customized solution works more for business and brings any candidate ahead of others through the sound knowledge of the framework implementation methods. However, aside from creating customized solutions, you must adapt your solution designs to fit the business structure and ensure your valuation works for the company’s goal. Indeed, a case interview is best implemented with accurate information about the business structure, value proposition, and target audience.