BUSINESS SITUATION

FRAMEWORK
DUKE APD CONSULTING CLUB

1
INTRODUCTION TO CASE PRACTICE SERIES

2017 Spring Lecture Series

1) Case Practice 101
2) Profitability Framework Systematic &
3) Business Situation Framework Client-friendly
4) Drilling-down Procedure and Issue Tree Adaptable
5) Mental Math & Market Sizing Accurate & Fast
6) Synthesis & Conclusion Client-friendly 2
OUTLINE

Review: Basic Steps for Case Solving

Framework Requirements
Profitability Framework Review
Business Situations Framework
Framework in Action
What is left?
Case Practice
3
OUTLINE

Review: Basic Steps for Case Solving

Framework Requirements
Profitability Framework Review
Business Situations Framework
Framework in Action
What is left?
Case Practice
4
STEPS FOR CASE SOLVING

Summarize the case and clarify the objectives

Make hypothesis and develop your structure
Drill down on each topic
Summarize the results

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OUTLINE

Review: Basic Steps for Case Solving

Framework Requirements
Profitability Framework Review
Business Situations Framework
Framework in Action
What is left?
Case Practice
6
ABOUT FRAMEWORK
A good framework should be MECE (mutually exclusive, collectively exhaustive)
Why Framework?
Framework vs. Laundry List

international
female

International

Domestic
Chinese

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American
OUTLINE

Review: Basic Steps for Case Solving

Framework Requirements
Profitability Framework Review
Business Situation Framework (CPCC)
Framework in Action
What is left?
Case Practice
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PROFITABILITY FRAMEWORK

Profitability (Quantitative Method)

Profit = Revenue - Cost

Case interview secrets, by Victor Cheng

OUTLINE

Review: Basic Steps for Case Solving

Framework Requirements
Profitability Framework Review
Business Situation Framework (CPCC)
Framework in Action
What is left?
Case Practice
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FRAMEWORKS

Business Situation (Qualitative Method)

Company
New Market New
Expansion Position
Business Entry Product Assessment

Business Situation

Customer Product Company Competitors

customers?
segments of customers
Preferred distribution
channels
Nature of product Capability and expertise Industry behavior
Commodity or Cost structure Competitors specialties
Differentiable goods 11
Barriers entry
Lifecycle
Case interview secrets, by Victor Cheng
CASE SAMPLE

Shoe Manufacturer
You are a consultant working with a shoe manufacturer. The CEO noticed that there is a
increase in sales this year. He asks us to find whether it is reasonable to introduce their
products to Vietnam.

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CUSTOMER:

Identification (Customer segments, size, growth rate & trend, % of total market, )
Key needs of each segment
Pricing and price sensitivity/elasticity
Distribution channel preference for each segment
Customer concentration and power (the Walmart Effect)

2/23/2017 13
CUSTOMER ASPECT IN ACTION:

Business Situation (Qualitative Method)

Company
New Market New
Expansion Position
Business Entry Product Assessment

Business Situation

Customer Product Company Competitors

Who is the customers? Nature of product? Capability and expertise Industry behavior
What are the segments of Commodity or Cost structure Competitors specialties
customers? differentiable goods? 14
Barriers entry
Preferred distribution Lifecycle
channels Case interview secrets, by Victor Cheng
CUSTOMER-RELATED QUESTIONS

Who is the customer?

What are their key needs?
What does each customer segment want?
How sensitive are they?
Distribution channel preference by segment
Customer concentration and power

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PRODUCT:

Nature of Product
Commodity or differentiable goods
Products lifecycle (novel vs. obsolete)
Packaging

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PRODUCT ASPECT IN ACTION:

Shoe Manufacturer
Company
New Market New
Expansion Position
Business Entry Product Assessment

Business Situation

Customer Product Company Competitors

Who is the customers? Nature of product Capability and expertise Industry behavior
What are the segments of Complimentary or Cost structure Competitors specialties
customers? Substitutes 17
Barriers entry
Preferred distribution Lifecyle
channels Case interview secrets, by Victor Cheng
COMPANY

Shoe Manufacturer
Company
New Market New
Expansion Position
Business Entry Product Assessment

Business Situation

Customer Product Company Competitors

Who is the customers? Nature of product? Whats the company good Industry behavior
What are the segments of Commodity or at ?
Competitors specialties
customers? differentiable goods? 18
Barriers entry
Preferred distribution Lifecycle
channels Case interview secrets, by Victor Cheng
COMPANY

Capabilities and expertise

Distribution channels
Cost structure
Investment cost Whats the company good at ?
(Maybe what are the weaknesses?)
Intangibles
Financial situation
Organizational structure

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COMPANY

Capabilities and expertise (or Key Success Factors KSFs)

What is the driving force behind a successful company
Opportunities actions depends on capabilities !
Example: Shoes Manufacture technology or design

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COMPANY

Distribution channels
Where to sell your products? online, retail store, direct
Where are the customers? + What Channels do they prefer? Fixing the Mismatch
Be careful with different segments!!

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COMPANY

Cost Structure
Is the client a LOW-cost producer or a HIGH-cost producer?
Given very specific detail about cost structure change framework!
Fixed cost vs. Variable cost
High fixed cost = Barrier of Entry

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COMPANY

Intangibles
Brands / Brand Loyalty Emotional Reasons
Investment Cost (only if the cases involves an investment decision)
Cost-Benefit Analysis (CBA)

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COMPANY

Financial Situation (How much money do we have?)

Financial health = basis of developing strategy and marketing plan
Organizational Structure
How rules and responsibilities are specialized and dispersed

Best way to serve the MARKET what the market wants !

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COMPANY

Capabilities and expertise

Distribution channels
Cost structure
Investment cost Whats the company good at ?
(Maybe what are the weaknesses?)
Intangibles
Financial situation
Organizational structure

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COMPETITORS ASPECT IN ACTION:

Shoe Manufacturer
Company
New Market New
Expansion Position
Business Entry Product Assessment

Business Situation

Customer Product Company Competitors

Who is the customers Nature of product Whats the company good Who are they?
segments of customers at ?
Commodity or How are the others doing?
Preferred distribution differentiable goods 26

channels Lifecycle
Case interview secrets, by Victor Cheng
COMPETITORS

Competitor Concentration & Structure

Competitor behaviors
Best practices
Who are they? and
Barriers to entry How are the others doing?
Supplier concentration
Regulatory environment

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COMPETITORS

Competitor Concentration & Structure

Example: Shoes Manufacturer
- Who else is the selling same types of product in the market?
- How is the market share mix? + Who gets what?

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COMPETITORS
Competitor behaviors
Target customer segments
Product differentiation
Similar to how we analyze the client
Pricing Strategy
Two questions: What are they doing and what they can do?
Distribution Strategy
Brand Loyalty
Best Practices
Who are the leaders? What are they doing that were not?

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COMPETITION

Barriers to entry
Are there any barriers to entry to the new market?
Regulations / Cost Advantages

Supplier concentration
How many suppliers out there? + Who can get access to them?

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COMPETITORS

Industry regulatory & environment

Are there any? How they affect the company?
Life-cycle of industry
Different strategies
Different competitors
Different margins

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COMPETITORS

Competitor Concentration & Structure

Competitor behaviors
Best practices
Who are they? and
Barriers to entry How are the others doing?
Supplier concentration
Regulatory environment

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SUMMARY

Business Situation (Qualitative Method)

Company
New Market New
Expansion Position
Business Entry Product Assessment

Business Situation

Customer Product Company Competitors

Who is the customers? Nature of product? Whats the company good Who are they?
What are the segments of Commodity or at ?
How are the others doing?
customers? differentiable goods? 33

Preferred distribution Lifecycle?

channels Case interview secrets, by Victor Cheng
LECTURE SERIES SCHEDULE

2017 Spring Lecture Series

1) Case Practice 101 Missed a Lecture?
2) Profitability Framework
Want to Review a Previous Lectures
3) Business Situation Framework Material?
4) Drilling Down Procedure and Issue Tree
Visit our YouTube Channel:
5) Mental Math & Market Sizing http://bit.ly/2jr6Uky
6) Synthesis & Conclusion or search Duke APD Consulting Club
34
OUTLINE

Review: Basic Steps for Case Solving

Framework Requirements
Profitability Framework Review
Business Situations Framework
Framework in Action
What is left?
Case Practice
35
 CASE PRACTICING

How to give a feedback in case practice Basic steps for case

Time: usually ~30 min. Can be extended for solving:
beginners
Summarize the case and
Track down the partners performance clarify the objectives
during the practicing, where they did good Make hypothesis and
and where they got stuck (with the form in develop structure
the handouts)
Drill down on each topic
Summarize their strong points and weak
points Summarize the results

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