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The Perfect Study Plan to Prepare for Mckinsey PST

By Kim Tran March 1, 2017Problem Solving TestNo Comments
Consulting Interview Prep

The Perfect Study Plan to Prepare for Mckinsey PST

By Kim Tran | Problem Solving Test | No Comments

Whether you talk about time-pressure intensity, difficulty level, limited prep resources, or the low passing rate, McKinsey Problem Solving Test is one of the deadliest tests ever built on Earth. Don’t even think about the Case Interview unless you can pass the PST.

… in this video and subsequent ones, we’ll tackle every aspect of a perfect study plan for this test …

To be honest with you, the Problem Solving Test is what gets me into the idea of founding this Management Consulting Prep platform. At the time, I was dying to get into McKinsey. Not only I wanted to be a management consultant, but I wanted to do it at McKinsey. Of course landing a job in ANY of those “Big 3” would be a dream already. But with all respect to Bain and BCG, McKinsey does have an edge.

But standing in middle of my super aspiration is the freaking Problem Solving Test. I was frustrated and at the same time very nervous. My key to success as a student in college had been to study hard. But with the PST, it didn’t work. You can’t study hard without a whole lot of materials.

Now looking back, I am just grateful. The PST forced me to be really strategic and to study really SMART. I developed for myself a rigorous study strategy that allows me to get into the teeth of the test principles and get a lot better without a lot of actual practice tests.

I shared my system on a simple personal blog, and it’s just been getting bigger and bigger. The feedback is positive and the audience is just growing like crazy every year.

—-

The PST is a very interesting concept. Have you ever asked why it came to existence?

Well, consulting firms are just like any other businesses. They have to balance between effectiveness and efficiency. Sometimes, there’s not a middle ground to achieve both. Take recruitment, for example, we have the CV screening round as a very efficient way to evaluate candidates. Consulting firms can assign relatively low-ranking staffs on the task and they can sort a large volume of CVs in a short time. But CV screening is not 100% accurate. That’s why there’s the Case Interview. While it’s a lot more effective than CV screening, it costs a LOT more. It takes about 5 hours of high-ranking managers for each candidate.

Then McKinsey said: no we need to create something in between to balance the two aspects.

Here comes the Problem Solving Test! I think this is a great invention. The CV screener can pass in more “risky” candidates and the interviewer for sure will spend time with a much better group of candidates.

Over the last couple of years, we have seen BCG adapting to this trend, creating their own version of the PST: the BCG Potential Test. Later in this video, we will touch briefly on how the BCG Potential Test is like.

But now, let’s talk about how the McKinsey Problem Solving Test! What is it like?

It’s a multiple-choice test with 26 multiple-choice questions, divided into 3 cases, each usually starts with 1 page of reading then a few questions then a few more reading then a fewmore questions. There’s a time limit of 60 minutes, which you would need to use every second of it. Even the smartest people I know would barely finish the test in the last minute. Many, including myself, don’t even make it to the last question.

Another bad news, the test is quite numerically heavy and they don’t let you use the calculator. About half of it involves calculations of some sort.

This test is such an interesting topic, and of course, there have been quite a few myths about the test. Now let meburst them here!

No.1: The PST is a Case Interview on paper. 

No, it is NOT!  If you think of a set of management consulting skills as everything in this square, the Case interview can cover something like this and the PST covers something like this!

There are a few common qualifications both rounds examine but each specifies in its own ground. And they are meant to be that way!

The PST is much more heavy on the logic, the number, or in daily language: the nerdy part of a consultant while Case Interview is more on the actual person-to-person consulting work.

No.2: The PST is similar to the SAT Math.

This is a horrible comparison!These two are completely different tests. Even for the most seemingly related part: the quantitative part isnowhere near close. The SAT is strictly about math while the PST is much more about the logic and business problem solving. Even for a tiny portion of the SAT Math which has some “Word Problems”, they are fairly simple ones with context not even set in business.

Don’t spend any of your valuable time on the SAT. It’s like practice driving a car to prepare to fly an airplane. I am not saying driving a car doesn’t help with anything, but the value you get out of that practice is soooo small regarding your goal to fly an airplane.

No.3: You either have it or you don’t have it or in other words, the ability to pass the PST has to be something you were born with.

Of all, this is the most terrible myth. It probably started by some consultants out there who didn’t prepare for the test and still pass.Maybe they were trying to show off, or maybe they just don’t care about listeners. Every time you hear someone say that, immediately disregard it.

The PST CAN be learned!

How? Let’s get to that part right NOW!

A perfect study plan for the PST involves two equally important parts. In the scope of this one video, we can’t talk about every part in great detail, please refer to follow up videos. But anyway, the two parts are:

  • No.1: The ability to answer the questions CORRECTLY
  • No.2: The ability to answer questions QUICKLY

Many people don’t have the patience to separate their study in these differentareas, turns out their study is all over the place with no point of focus. It’s so hard to do that way. It doesn’t save any time either.

Part #1, the key objective is to understand the test, the logic inside out, and we are able to solve  every question as closed to 100% correctly as possible, of course without any time pressure.

To help you with this part. We analyze the test critically and divide it into different question types. This is the link to the playlist in which we talk about each question type in great detail: how they are constructed, what’s the logical foundation of them, how the “wrong” choices are usually made, etc.

Basically, there are 6 types of questions, accounting for 90% of the test.

The test gives us a number of data and information, or we simply call it: FACT. When a question just strictly asks about the Facts themselves, we call this “Reading-facts question”.

Let’s say: the Fact is: “there are 1,000 more visits to the MConsultingPrep website on Monday than that of Sunday“. A reading facts question may ask you:

“Which of the following best estimate how many visits per hour monday has more than that of sunday?”

This accounts for 38% of the PST and almost 100% of the BCG Potential test. So, BCG test takers, you know where to focus your study on!

Refer to the hyperlink here for greater details.

When a question goes a step beyond this, asking you about what reasons, if TRUE, may explain that facts, we have “Root-cause reason questions“. This is a somewhat similar to hypothesis in case interview. The difference is that, in case interview, we use hypothesis to save time and to pinpoint our approach in a more efficient way. In the PST, “Root-cause reasons” only tests your logic. You don’t need to worry about whether a possible root-cause is possibly true or not. You just need to identify if that possible root-cause does explain the given fact or not.

Given the fact provided above, a root-cause reason question may ask you:

“Which of the following statement, if TRUE, would NOT correctly explain the assertion above?”

On the answer choices, we may have:

A) MConsultingPrep public new contents every Monday

B) Most students don’t have the habit of studying on Sunday

Etc.

Notice that even though statement A is not correct in real life, this still counts as a possible root-cause for the given fact. Remember that on the question, there’s the phrase: “if TRUE” clearly stated.

This question type accounts for about 13% of the test.

Now on the other side, when a question goes a step in the other direction, asking you to identify what conclusions you can logically make based on the provided facts, we have the “Fact-based Conclusion questions”.

Given the running context, a fact-based conclusion question may ask you:

“Which of the following statement can be correctly CONCLUDED based on the given fact?”

On the answer choices, we may have:

A) MConsultingPrep live-chat support staffs have to standby on Monday.

B)The website server faces more pressure on Monday

Etc.

Notice that even though statement A is true in real life, this is NOT a correct choice here. Remember that we are talking about statements logically concluded FROM THE GIVEN FACT.

This accounts for about 14% of the test.

Step beside those logical views, when a question needs you to set up equations to solve, we call it “Word Problem questions”. Sometimes, they don’t need you to solve for absolute answers, but rather answers in variable format, like this, <show sample variable format> we have the “Formulae questions”.These two accounts for about 20% of the test.

Lastly, almost every case in the PST starts with an introduction case context page. At the end of that context is often a statement from the CEO, manager, or Chairman. Then the first question often asks you about that assertion. We call this “Client Interpretation”. Almost every case has one question of this type.

If I were you, tackling the first part of the perfect PST study plan, I would study each question type one by one in great details, understand it inside out. You will find that when the test is broken into this level of detail, solving them 100% correctly without time pressure is very very feasible.

When you can do that, gradually move to the second part of the study plan. I say the word “gradually” because there may not be an exact turning point where you completely finish the first part and completely focus on the second part.Some of the skills on the second part you may want to start early and some of the stuff on the first part you would want to come back for reviewing purposes. But generally, make sure you know how to get it RIGHT before get it FAST!

Part #2 of the perfect study plan: how to increase your SPEED!

There are 3 + 1  sub-parts of this:

2.1: Increase your reading speed!

This sounds difficult but it’s not. There are so many programs outthere on how to read faster. We have tried many and probably the best one is a program created by Princeton. This method only takes a couple of hours of intense practice and the result is tremendous. Candidates we tested using this method all at ease improve their reading speed by double. Some even higher. Don’t worry if you don’t know what that is. Refer to our website to download the free PDF on this program. We will soon make a video demonstrate this method in an even more powerful way. When that video is done, the link will be here!

2.2: Increase your calculation speed!

There’s no doubt that a big chunk of the test involves math. The quicker you do this, the more time you can spend on the non-quantitative part.

This is a muscle that just needs practicing. The more you pound in, the better you get. It’s much more simple than the qualitative part where you need to understand the logic first. The challenge is that it’s hard to take the math out from the PST and practice it alone. We usually have to do it together with other skills in our already limited practice materials.

Understand this need, we have developed quite a few free practice drills on our website. At the heart, math is as it is, but we present it in a number of different formats: plain calculation, short context, long context, and chart context, to best replicate the real environment you will encounter in the real PST and also in the Case Interview.

2.3: Embrace test taking hacks!

It doesn’t hurt to know a few tips here and there. But this can get pretty confusing. At the time I was preparing for the test, I got so many different tips, many of them even conflict with each other. To be honest, even now I don’t know which is better.

Should we read the question first then go back to the context, or should we read the context first? If we decided to do something in between, to what extend?

Well, these are all very personal preferences. So in the process of giving you tips, I provide you also an index on how strongly you should follow my advice. Some items I really really want you to apply while there are others I am just giving you my preference for reference purposes.

Please refer to our website to the most up-to-date list of tips & tricks. As the format and the environment of the test can change slightly from years to years, content in this area needs updating regularly.

2.4: Putting it altogether into practice cases.

Lastly, a very important factor of this 2nd part is to put it all together in a complete case and to take them like real testing environment. This is like the final act, gluing all the things you learn throughout the study plan together. For this, what you need is a bunch of practice tests as close to the actual test as possible.

If you follow my study plan from the beginning, unlike others, you haven’t had to use any of the official practice tests from McKinsey themselves. Now is the time to use them. Plus, to add a little positivity, we provide you one practice case. You can download it for free from our website as well.

——

So there you have it: A very brief layout of the perfect study plan. I hope this adds a lot of values to your study and you can take these insights, apply them, and design your own specific study plan that suits your background and timeframe. If you need help with that, transforming this into a specific day-to-day plan, please also refer to our website.

Best of luck with this brutal test!

At Management Consulting Prep, we believe, everybody can pass the PST. Are you a believer?

 

Case Interview Starter Guide for Non-business Candidates

By Kim Tran March 1, 2017Case InterviewNo Comments
non-business candidate

Case Interview Starter Guide for Non-business Candidates

By Kim Tran | Case Interview | No Comments

It is said that management consulting is for everybody and people with backgrounds outside of business can compete in case interview just as well as anybody and very little-to-no business background is needed for case interviews.

NO, it doesn’t work like that!

Hi, my name is Kim Tran, a former McKinsey consultant and the founder of the platform Management Consulting Prep.

Even though all consulting firms claim that the consulting career is for everybody of all education backgrounds. But no matter what, case interview always involve a few business concepts. For non-business students, this may bother you from the actual study of case interview skills.

So I hope through this very compact blog post, I will be able to provide you, non-business people, everything you need before starting to learn cases just like a business student. If you are already a business student, you may skip to the later part – Chapter 4. This latter section may contain some contents that not all business students know.

This article is presented using the 80:20 principle. 20% of business knowledge can get you 80% as equipped as normal business students. We will select most basic but high-impact terms and concepts. We divided this into 4 chapters:

  • 1: Accounting and financial terms
  • 2: How a company is typically organized
  • 3: Business Strategy concepts
  • 4: Management Consulting terms& concepts

Chapter 1: Accounting & Financials, the language of business!

Well, it takes accounting students years to learn these all concepts, but I will try my best to do it under 5 minutes.

There are three legendary Financial Statements: Balance Sheet, Income Statement, and Cash Flow

Balance Sheet is like a snapshot of the current stage of the company’s property, debt, and ownership AT one given point in time. Sure enough, the balance sheet shows three figures …:

  • Assets: what the company owns: Building, Equipment, Cash, Inventory, along with some other intangible items as well.
  • Liabilities: what the company owes: Loans, bills to be paid, etc. Debt is like negative assets.
  • Take Asset subtract Debt, we have the “net worth” or “book value” of the company. It’s called Equity.

The neat thing about the  Balance sheet is that it’s ALWAYS balanced. Every action, every transaction changes the three components but it’s always in harmony. A few examples:

  • Take cash to pay debt? Both Assets and Liabilities reduced.
  • Owners invest more money in the company? Assets and Equity both increased.
  • Sold a service for some cash? Assets increases and so is the equity. We will talk about the mechanic of how Equity really changes in moreadvanced videos.

Above, I showed you a few important components of the three big parts: Assets, Liabilities, and Equity you may need to know. Sometimes they are categorized in one or other way, but most of the times you can easily grasp them.

Next, Financial Statement: the Income Statement, sometimes called the Profit& Loss, or P&L.

While the balance sheet is a snapshot at a given time, the Income Statement records the business performance through a period of time, says a quarter, a year. The Income Statement directly tells you how the company is doing in terms of making money, the heart of any business. From the top to bottom, the Income Statement showsthe Revenues, Costs, and Profits. That’s why often times, Profits is referred to as the “bottom line”.

While Revenue is straight forward, Cost has a number of tricky components. Here are a few most frequently-mentioned types of Costs:

  • The Cost of Goods Sold: refers to the direct cost of the product or service sold. For example, if I sold you a $5 T-shirt which I bought at the price of $3 earlier from Walmart, then my revenue is $5, my Cost of Goods Sold is $3.
  • Marketing Expenses
  • Salaries
  • Administration Expense
  • Depreciation & Amortization: these are interesting types of cost because they are non-cash. It involves a big cost the company paysupfront for a big thing. But that big thing adds values over a long period of time and therefore being allocated throughout a longer period. An example of depreciation would be the cost of a building allocated throughout decades. Amortization is just the different version of depreciation used for intangible assets, such as patents, licenses, etc.
  • Interest Expense
  • and lastly, Tax

Depending on specific needs and conditions, companies break down the Statement into various further steps down the stream, along with a percentage of the total revenue, called “margin”. For example, we have:

  • Gross Profit, which is just Revenue subtracts Cost of Goods Sold;along with this, we have “Gross margin percentage”
  • EBITDA <pronounced “e bit da”>, which stands for Earnings Before Interest, Tax, Depreciation & Amortization; along with this we have “EBITDA margin percentage”
  • EBIT, which stands for Earnings Before Interest and Tax; along with which we have “EBIT margin percentage”

One important thing to notice is that even though it may seem like, but the Income Statement does NOT necessarily relate to the cash and any money factor. Many of the times, especially for “Business to business” transactions, the selling happens before the money flow. So we may have to record a revenue without having the cash yet.

So how do we keep track of the cash? That leads to the third Financial Statement: the Cash Flow Statement.

There’s a famous saying that: Income statement is an opinion, Cash Flow statement is the fact. Interesting hah?

The Cashflow statement just strictly monitors the cash flow in or out, categorized in different sections. Three of them are: Operation, Financial and Investing.

Ok, so that the brief overview of all what accounting students learn during their colleges. These basic terms and concepts should help you have a head start in the realm of business.

—-

Chapter 2: How a company is typically organized?

When it comes to that, it is important to notice the fine line between company’s ownership & management.

Technically, at the highest level, there are shareholders. Each share, or stock represents a part of company’s ownership. For private companies, the group of shareholders and their shares are not necessarily disclosed and publically tradable. For public companies, on the other hand, shares are publically traded on different stock exchanges. One of the most famous is the NYSE, stands for New York Stock Exchange.

Now a company can have one, a few, or millions of individual owners. So having that many people directly involved in companies’ decisions is not a good idea. That’s why they do it indirectly, through something called “the Board of Directors“, or sometimes “the Board“. They are a group of people elected by owners to help govern the company. The head of the Board is called the “Chairman” or the “President“. Technically, this is the highest position for a single person in a company.

Now while the Board does a lot of important work, they are not there to do the dirty day-to-day work. The board usually hires a management team to do that. The head of the management team is called Chief Executive Officer, or the CEO. The CEO is the highest position on the management side, making every decision on the day-to-day work. Most of the time, the board of directors doesn’t directly intervene in the CEO’s work, but they reserve the right to fire CEOs.

As I said before, the Board is not really there to work. It’s there to lead. So to further help them do that, there’s a committee called Supervisor. The supervisor’s job is to independently monitor the CEO and the management team and report up to the Board.

Now come an interesting part, below CEOs, there are two generally two ways of structuring the company. One way is through business lines and the other one is through  functions. Think of business lines as mini companies themselves inside the big company.

Within functions, here are a few most typical divisions most companies have:

  • Accounting: incharge of keeping the record of all companies’ transactions and making meaningful reports based on them.
  • Finance: incharge of managing the money aspect. I often think of finance as how to not having too little cash and also how to not having too much Having that much cash sitting around and doing nothing is a waste of resources and companies usually involve in various investment activities to best utilize it.
  • Marketing: now the definition of marketing can vary by a huge number of factors. To me, I often think of marketing as how to put the company in the position to sell as much as possible. This involves doing branding, communications, setting up pricing policies, developing distribution channels, and last but not least, to orient the products.
  • Sales! In many companies, Sales &Marketing are put together. But there’s a slight separating line. Marketing is about putting ourselves in the position so that people can find us, quite a passive way. Sales, on the other hand, is to actively go out and sell products.
  • Operation: incharge of running the company, making it efficient. This is so big that sometimes we have the notion that COO, Chief Operation Officer, is, in fact, the vice-CEO.
  • Product Development & Research: incharge of making the product either it’s tangible or intangible.
  • Strategy: in charge of planning and monitoring business performance to achieve goals and objectives. This is probably one of the most underrated division of all companies. Many companies don’t even have a strategy department, making it by default the role of the Board and CEO. This is where companies like McKinsey, Bain, and BCG often come to help.

Chapter 3: Business strategy concepts

Ok, here comes the part where even some business students may need to hear as well, especially if you are not a strategy major.

I am going to give you some of the most basic concepts about “strategy”, which you will need to use a lot if you become a management consultant.

  • Organization: In general, this refers to “how a company is organized, what are different components that make up acompany”. Organization is often presented through “Org Charts”. Here’s an example of the Org chart of … my family. We have “mommy” as the big boss, “daddy” as the big boss’s assistant, and various business lines represented by my brothers and sisters.
  • Governance: This refers to how a company is managed and directed, how well the leader team runs. The leader team includes Board of Directors (BOD) and Board of Managers (BOM). A company with good governance has good leadership people, tight control, and effective check & balance processes, etc.

My family has an amazing governance. Dad and mom’s roles are very clear. They hold a brief meeting with us every day through our dinner. And once a week, we sat down together for on big meeting, where big family issues are discussed and voted if necessary. They even have all the children act as supervisors, monitoring the activities ofeach other; and many many more.

  • Process: This is like rules and common practices of  having a number of processes, entailing every single activity. A process design should include 4 factors: who, what, when, and accompanied tools.
    For example, let’s look at my family’s Excursion process (see the video).
  • The who part is presented on the y-axis, left-hand side, labeling all departments, a.k.a: family members, involved.
  • The what part is presented through the big midsession with each box represents each single activity.
  • The when and tools parts are presented at the bottom
  • B2B vs B2C: stand for “Business-to-business” and “business-to-customers”. These two terms refer to two types of transactions a company typically does: transactions with other companies and transactions with individual customers.
  • Bottom-up vs Top-down: this refers to two opposite school of thought or action, each with its pros and cons.
    For example, if the problem is: where is my lost key… then:

    • A Top-down method would divide the search area into different regions: floor 1, floor 2, floor 3; then tackle each region one by one.
    • For a bottom-up method, on the other hand, I would go right into the very specific spot I think I may have placed my key … say … on top of a microwave … behind the TV … etc.

Chapter 4: Consulting business terms

Ok, in previous chapters, I introduced to you some of the most commonly-used terms and concepts in business strategy; now, we will talk about those that are particularly popular in consulting.

  • Lever: Think of this as one or a group of initiatives, actions to perform or to meet certain goals. e.g. some levers to help increase customer experience in a hotel are:
    • Free breakfast
    • Free Wi-Fi
    • 24/7 support
  • Best practice: This refers to how things should be done, especially if it has been successfully implemented where else.
  • Industry vs location vs function: Now these are three parameters the consulting world uses in the categorization of businesses.
    • Industry: used to group different companies mostly based on their PRODUCT. For example:
      • Banking Industry
      • Construction Industry
      • Education Industry
      • Steel Industry
    • Function: is the categorization mostly based on missions and type of roles of different parts of a company. For example:
      • Human Resource takes care of people-related missions
      • Finance takes care of money-related missions
      • Some other important functions most companies have: Strategy, Operation, Sales & Marketing, Product Development, etc.
    • Location: is where things are geographically.

So normally, when two consultants asking each other on “what do you work on?”, they need to give 3 pieces of information in all of those three parameters, such as “So I worked on a Cement project, focusing on Finance, in Southeast Asia.”

In fact, all of the McKinsey support networks are organized in this way. During my projects, I would need to speak to some Cement experts, some Finance experts, and some local experts as well.

  • Granular:This refers to how specific and detailed a break-down or an issue goes. For example, a not-so-granular break down of the NBA is: the West and the East conferences. A much more granular is something like this: Leagues, Conferences, Divisions and Teams.
  • MECE: MECE is so important, we have a whole video on it. See it here. But in short, MECE is the standard, per which we can divide things down in a systematic, comprehensive, and non-overlapping way.

—-

Phew, this is a relatively long article, but it is still way shorter than 4 years of college business education. I hope this will act as a great prerequisite to your case interview study. Feel free to go back to read or watch this video a few times if you need to. Once you have got all content here, you know what, you are ready to tackle Case Interview. Go right ahead to the “Case Interview 101” video, you will have a great time there!

Also, if you are interested in learning even more consulting terms and concepts, please get hold of a detailed PDF, which you can download for free from our website. There you will find way more terms and concepts with descriptions and examples.

Now the fact that you make it to the end of this proves your commitment to learning case interview, despite the non-business background. Well, keep up your spirit and soon you will find yourselves compete toe-to-toe or may even perform better than business students. It’s harder at first for you, but the more you study case interview, the more yourealize it is more about problem solving  and the business things are just the context!

At Management Consulting Prep, we believe  everybody can make it to consulting. You a believer?

McKinsey Case Interview

By Kim Tran December 10, 2016Case InterviewNo Comments

McKinsey Case Interview

By Kim Tran | Case Interview | No Comments

How different are McKinsey & other cases?

Anywhere on this website or on our Youtube channel, we talk about Case Interview as a whole. We try to give you, our dear audience, the broad and universal rules, concepts, techniques, mindset, tools, habits, etc. that if you possess, you can walk into any consulting case interviews and absolutely feel comfortable. While I still think that is the ultimately correct approach, it doesn’t hurt to dig a little into the specific differences between interviews of various firms. We begin now with McKinsey, one of, if not the most sought after destination for aspiring consultants. Let’s see what the differences are between McKinsey Case Interview and others!

Notice:

Like I said multiple times on our Youtube Channel, there’s no clear distinguishing line between McKinsey, Bain, or BCG interviews. It’s totally possible that you walk into a McKinsey case interview and feel like it’s a “BCG” interview. So the insights in this article are just the generalizations of what’s common in McKinsey case interviews. To prepare for your up-coming case interviews in any consulting firms, you may want to see: Consulting Interview Prep – How to prepare for Consulting CaseHow to avoid getting stuck in cases?

1/ McKinsey case interview lean more toward the Interviewer-led format

If you don’t yet know what an Interviewer-led case is, you may watch our Case Interview 101 video – the very first lesson for every newbie and the Candidate-led video to hopefully get a sense of case interview types. We will certainly dedicate a video to Interviewer-led case soon, so stay-tuned.

Let’s come back to the topic, yes, the majority of McKinsey cases are in the interview-led format. It is in which the interviewers usually don’t prepare a case that’s too structured and will typically ask you to work on various mini problems. Many times, those mini problems don’t even link together. So definitely check out some common question types in case interview and how to answer them if you are going to have a McKinsey interview soon.

2/ Despite the seemingly unstructured format, McKinsey case interviews need a lot of “structure”

If there are three words you would hear the most on any McKinsey project, one of them is definitely “structure”. If you ask a partner or principle on how a candidate performs, you will always hear responses like “very structured”, “not structured enough”, etc. It sometimes even feels like the only thing on the interviewer’s evaluation sheet is “structure”. McKinsey worships structure! So it’s vital to show your structural  mindset anywhere possible.

mckinsey case interview

McKinsey Case Interview

3/ McKinsey people are “hypothesis-driven” folks

I just talked about “structure” being one of the top three most-spoken words at McKinsey, “hypothesis” is another word that’s also in the mix for sure. McKinsey is made up of highly hypothesis-driven folks. While in Bain or BCG cases, it may be ok to implicitly use hypotheses, you need to explicitly and clearly use hypotheses in McKinsey case interview.

For those who are not yet familiar with Hypothesis in Case Interview, we already made an awesowe video about it!

To practice for McKinsey Case Interview, you can try to do some Case Interview Questions. 

* * *

If you’re ready to go deeper, our website has plenty of resources for you to explore, and you can also subscribe to our YouTube channel  or our emailing list!


 

Best,

Source: mconsultingprep.com

Tags: Case Interviews,  Case Interview Question

Candidate-led Case Interview

By Kim Tran October 17, 2016Case Interview2 Comments

Candidate-led Case Interview

By Kim Tran | Case Interview | 2 Comments

Candidate-led cases are interesting but also very difficult, especially for beginners. I personally really like these cases because they represent very well how an actual consulting project works and the role of the engagement team in it.

So rather than talking specifically about how a candidate-led case works, let me introduce you to the LOGIC behind problem solving in management consulting. It’s ironic that many experienced candidates, having practiced 20 to 30 cases, actually don’t grasp this very well. That’s why even with that much practice, they can still struggle in certain cases and still feel like they need even more practice.

Well, practice is good, but only when you have mastered the basics. We talked a little bit about this in the Case Interview 101 video  but here is the much more in-depth explanation. To make this as easy to follow as possible, I divided the whole concept into bite-sized elements with numbers.

So here we go: the core logical foundation of how management consultants solve problems.

  • No.1: The problem has to be defined
  • No.2: To solve a big problem, we, management consultants, don’t look for solutions right away. Instead, we try to find the ROOT CAUSE. This ensures us that we have completely eradicated the problem and have a long-lasting impact.
  • No.3: There can be millions of possible root causes. To effectively and efficiently find the right one, we use a top-down and MECE approach. This is called an “issue tree”. See our MECE and Framework video for more details.
  • No.4: In order for each branch to exist in the issue tree, there HAS to be a chance that the Root-cause is in it. In other words, for every branch, there must be at least one hypothesis associated with it.
  • No.5: Now assume we have a structured, MECE, and hypothesis-based issue tree. Pick the best hypothesis,or,  in other words, choose a big branch to begin with. Then test if the root-cause is in there.
  • No.6: Depending on each case, different methods are used to test the hypotheses. But benchmarks are a powerful tool, too. Two main types of benchmarks used are the historical and competitors’ data.
  • No.7: If data suggests that the root cause is indeed IN the testing branch, go down one level deeper and repeat the same process: breaking down the branches into sub branches in an MECE, hypothesis-driven way and test each sub-branch using data. See case interview examples and answers
  • No.8: At any point where the data suggests that the root-cause is NOT in the testing branch or sub-branch, move to a parallel branch or sub-branch on the same level.
  • No.9:  Keep doing this until the whole issue tree has been covered or until the interviewer would like you to switch gears.
  • No.10: Lastly, once you have identified one or many root-causes, think of solutions to resolve them!

In theory, the above approach always works. But the following two conditions must be met.

  • Condition No.1: each and every single part of the issue tree must be perfectly MECE.
  • Condition No.2: the issue tree, or in other words, the breakdown must somewhat properly isolate the root-cause.

A few tips to meet these conditions:

Condition No.1: each and every single part of the issue tree must be perfectly MECE. Let’s look at an example of a movie theater. Suppose that after a movie show, there’s an anonymous feedback that the sounding was bad from his or her spot. As the theater’s consultant, you divide all SEATS in the theater into three areas: left, middle, and right. No matter how much investigation and testing you do, you still can’t find the root-cause.

It turns out that the anonymous customer was in the disability area. The original breakdown was not MECE.. or more specifically: not exhaustive.

Sometimes it can be hard to be perfectly MECE for the whole process.

Condition No.2: the issue tree, or in other words, the breakdown must somewhat properly isolate the root-cause. For example, in the theater example above, if unfortunately seats with audio problems were in fact the seats in the back, then breaking down the theater into left, middle, and right areas will give any candidate a hard time tracking down the problematic seats. Testing each branch of the issue tree would only yield weird results. You will find the partial problems in each branch and cannot isolate the problem unless you adjust the issue tree or use another framework.

Well, here are a few tips to meet those conditions:

1. Make sure you understand the concept of MECE really well. Please refer to our MECE video for more details.
2. Try to improve your business intuition in order to be able to pick good frameworks or correctly draw spot-on issue trees. We devoted a whole eBook in our End-to-end program for this.
3. Most importantly, develop the habit of aligning yourself with the interviewer. No matter how good you are in relation to the above tips, there will always be cases that are hard to be MECE inside out and hard to draw frameworks that are spot on. The interviewer is actually a great resource you can use.

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Breaking into unconsciousness of case interviewers

By Kim Tran July 16, 2015Case InterviewNo Comments

Breaking into unconsciousness of case interviewers

By Kim Tran | Case Interview | No Comments

What do interviewers think when interviewing me? …

What questions are they asking themselves about me? …

Are they really going through a “checklist” that eventually determines whether I am going to hell or heaven? If yes, what does that checklist looks like? …

How do I understand what’s truly behind the words when he / she says or ask that question?….

It must be really nice to break into the interviewer’s mind? … We would always be saying the right thing and be a step ahead of the game.

Well, today I am giving you something even better than that. Not only will we find out about what those thoughts are, we will even break into the unconsciousness of interviewers. We will know exactly how interviewers feel, what they want, and what their impression of you is even before those thoughts are formed!

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Tags: Case Interview, Case Interviews

What are some of the most common questions asked in consulting Case Interview?

By Kim Tran July 13, 2015Case InterviewNo Comments

What are some of the most common questions asked in consulting Case Interview?

By Kim Tran | Case Interview | No Comments

First let’s define what “questions” means …

… In solving any cases, we as candidate go through “questions” of various level

… from big “case questions” like: “how to increase profit”

… to granular / detail questions like: “how many % have sales went down since last year?

So for simplicity reason, we talk about each in turn!

Case interview questions

Visit our “Case Interview Questions & Answers” for deep-dive into each of these question types!

 

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Two different tracks between McKinsey, Bain & Company and BCG

By Kim Tran July 9, 2015Case InterviewNo Comments
Case Interview Prep 

Two different tracks between McKinsey, Bain & Company and BCG

By Kim Tran | Case Interview | No Comments

Hi there,

Last week I got quite a unique email, quite long, but very interesting. Despite the flood of emails I’ve  gotten these days, this is the one I thought to myself that I HAVE TO REPLY!

If you can spend some time reading through the whole thing, that would be great!

The original email (names sanitized)

Dear Kim,

Thank you for building such a helpful platform. (Btw, I found it via your answer in Quora.)

Being a management consultant in MBB is my career plan in recent 5-10 years. Unfortunately, I do not think I am on the right track. I would greatly appreciate it if you can spare a few minutes to see my case and share your opinion and advice as an insider. I will be very interested if your company also provides career coaching service.

I got my bachelor in Transportation from a non-target university in China and a master in Transportation System and Management from National University of Singapore (NUS). Then I worked as a research consultant in Operation Research in a local consulting firm in Singapore for one year and later joined Arup (a top engineering consulting firm) as a transport planner. After 3 years in Arup, I went to Nanyang Technological University (NTU) to pursue a Ph.D in Maritime Study (concentrated in Supply Chain Management). Now is the end of the first year in my Ph.D program. That’s the brief instruction of my education and career background, I have attached my CV if you would like to know any details.

Last year, I found McKinsey’s Operation Academy (OA) program (https://mckinsey.secure.force.com/EP/job_details?jid=a0xA000000BSHDyIAP) online. I thought that I was a suitable candidate and so did Laura who referred me to Wings Zhang in Shanghai Office. Long story in short, my CV eventually reached Jenny Jin, the recruiter of Asia Operations Practice. Her reply is attached below.

Hi Eric,

Happy New Year. Hope you had a great holiday!

Thanks for the referral, but Eric’ experience is too specific for us and he just started his Ph.D, so it won’t work out. However, thank you again for the referral! 🙂

Regards,

YYY

I replied her regarding the two points she listed, unfortunately I did not get any further replies from her afterward.

I tried to figure out possible obstacles based on my limited understanding of the recruitment philosophy of McKinsey and listed the top three as follows:

  1. My education background: my undergraduate uni ranked around 350-400 globally, although NUS is ranked 25th and NTU ranked 61st by Times, they are not targeting schools. I am afraid that I cannot pass the CV screening.
  2. My major is not closely related to business: although I tried to shift my direction from transportation to supply chain management (SCM), the HR still thinks that my experience is too specific even for the OA program.
  3. My age: I would be 29-30 when I get my Ph.D degree (I was born in Dec 1988). I think it may be a little old to apply for an entry-level position.

There are two possible solutions I can think of for now:

  1. Apply for the SCM program in MIT (http://scm.mit.edu) and do it in parallel with my Ph.D since on average 2-3 out of every batch of their graduates join McKinsey.
  2. Join a good MBA program upon graduation.

I do not want to go for the second one unless it is really necessary.

If you are still reading, I would like to express my sincere gratitude. As an ex-consultant in McKinsey and current professional in management consulting preparation, what advice would you give based on my circumstance please? How should I prepare myself in the following 3-4 years if I want to successfully join MBB upon graduation?

Many thanks in advance!

Warm regards,

Eric

My reply:

Hi Eric,

Thank you very much for such an enthusiastic email. Also, thank you for your patience. I  try to reply to every email from my audience as fast as I  can but it’s very hard due to my busy schedule.  …

So anyway, first of all, I do see some consulting traits in your email. That’s  very good news. You are highly determined. You think like a consultant. You approach your own “case” through a consultant’s mindset. You also have a structured communication style: there are 3 things … No.1 is … No.2 is … and No.3 is … Very impressive and very consulting-like!

Now straight to the question you asked. Here’s my summary of your email:

  • You have a burning desire to be an MBB consultant.
  • You have educational background in NUS and NTU (major and the degree doesn’t matter much though).
  • You applied for the McKinsey OA program (which I will explain what it is in more detail (by my own words) below) but didn’t succeed.
  • You listed out some possible root causes.
  • You proposed some

If you took it upon yourselves a consulting-like methodology, I would add my feedback just like this is a real case interview or problem-solving session.

I agree with all of your analyses and insights. But I still have to bomb your case. And the reason is:

You’ve solved the wrong problem!

(Read more about the methodology of consulting problem-solving here)

It states right in the beginning of your email that your objective is clearly to become a consultant! A consultant, not an industry / practice expert!

I can see going into the OA practice is a fine option, but definitely not the ultimate goal for you.

Since you’ve solved the wrong problem, the bad news is: the whole analysis and proposed solutions are irrelevant. All three possible root-causes you listed are NOT going to prevent you in consulting recruitment process. And there’s no need to waste time and effort putting the two proposed solutions to action.

So why have you solved the WRONG PROBLEM?

Partially this is because of McKinsey’s complicated system and vague language.  Having been in the firm for quite a long-time, I still find the OA description on the website so cliché and misleading. So let me try to explain this from an outsider’s (but with deep knowledge of the inside) standpoint.

McKinsey‘s (and BCG & Bain) Org structure can be complicated but to simplify, the whole firm can be broken down into 2 parts or “tracks”: the Consulting track and the Support track.

McKinsey Organization Structure

The consulting track consists of consultants and is mostly considered as the more prestigious track. Normally, when people say something general  like “I want to join MBB”, they refer to this track! This is the face and the core of any consulting firm.

The support track, like its name suggests, is anything that helps the consultants do their work. This ranges from Administration, Translation Team, Visual Graphic Center, etc.

If it stops here, everything is nice and clear. But the complicated thing is that in recent years, McKinsey (and other firms) have been vastly expanding their support arms in terms of both depth and magnitude. There are more and more “support” teams being formed, and these teams are getting more and more involved in the “content” part. For examples: Excel Support, Writing Specialists, Market Research, and even industry and functional experts.

This  aims to make the work of consultants specialized more than ever. Consultants can now focus their energy and brain power more into the actual structuring and solving problems, regardless of industry or function’s knowledge.

The OA program you refer to is a part of the “Operation Practice”. And the “operation practice” is one “support” arm, which specialized in Operation, no more or less. Its purpose is to help consulting teams with whatever expertise needed with regard to “Operation”. It doesn’t matter if I am working on a cement project in Hanoi, a Banking project in London, or a public sector project in Sydney. Should I have any question on “Operation”, I can call experts in the “Operation Practice” for support.

Back to your question, if I understand your desire of becoming a consultant correctly, my short response is to ignore almost everything you mentioned. All of them are irrelevant in the consulting recruiting process. The only thing that matters is how well you perform on Case Interviews (assuming that you can pass the CV and PST round). That’s it!

Good luck with your career and let me know if you have any further questions!

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