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Hypothesis vs Fact-based Conclusion

Hypothesis vs Fact-based Conclusion

By Kim Tran September 23, 2016Management Consulting 101No Comments

Hypothesis vs Fact-based Conclusion

By Kim Tran September 23, 2016Management Consulting 101No Comments

There is an important concept of management consultants and yet consulting candidates don’t fully and firmly understand. I have witnessed people of various backgrounds missing it: from people I coached, my blog commenters, to even some McKinsey consultants. If you don’t master this concept, your case interview performance will be greatly affected.

Even if you are lucky enough to get into consulting, you will struggle. This concept touches the heart of Management Consulting methodology: hypothesis-driven approach vs fact-based conclusions. The difference between these 2 concepts should be clearly drawn out.

Suppose you have data X (or fact X).

A is a hypothesis when:           X can be true when A is true

B is a conclusion supported by fact X when:     If X is true, B is true

Statements like A are all just potential. They can very well be true. But we cannot confirm them with just X. Therefore they are called hypothesis.

Still confused? Let’s look at a simple example.

Fact X: The campus looks so empty now.

Hypothesis A1: It’s Christmas Eve!

Hypothesis A2: Students of this University are just not interested in studying!

A1 “fits well” with data X because if it’s Christmas Eve, probably no one would be on campus. But A1 cannot be concluded. What if it’s right in the middle of September, the campus is empty just because it’s Sunday?

A2 “fits well” with data X because if this school’s students don’t like studying, they probably would miss classes, which make the campus look empty. But again A2 cannot be concluded. What if this is in fact the Harvard campus; it is empty just because there’s a hurricane in the area and students are encouraged to stay at home?

So what’s a fact-based conclusion then? Here is one example:

Conclusion B: You will meet fewer students if taking a campus tour right now.

B not only fits well with data X but it can be concluded from X, or supported by X.The campus looks empty right now, for sure you will meet less people on campus now.

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Read more of this concept at Fact- based Conclusion and Case Interview

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