This is the ultimate guide to case interview frameworks, updated for August 2023. And this guide is refreshed to maintain its freshness for the 2023 recruiting season.
You’re going to learn the most common case interview frameworks to be familiar with for your consulting interviews
As bonus, you’ll see our stack-ranked tips and pitfalls to avoid when using these structures.
So if you’re looking for the best case interview frameworks you can find, then this is the guide for you.
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What are Case Interview Frameworks?
They are a tool that helps you structure your case interviews with consulting firms. They can be used to help you plan to structure how you solve the problem. Ultimately, they help you identify the relevant, key issues to be addressed during the case interview.
They can help ensure that you don't overlook important considerations when addressing a specific type of business problem.
A good case interview structure:
helps you break down the problem into it's component parts
is relevant and customized to the case context
What are Common Case Interview Frameworks?
The following case interview frameworks are among the most common you’ll find in case interviews with consulting firms.
Profitability Frameworks
The profitability framework is a tool designed to help you understand what makes an investment or company profitable or unprofitable. There are three common variants of the profit case type to be familiar with (mix, revenue-focused, and cost-focused).
1. Profit Variation (Mix-focused)
Case interview writers love to add "mix" as central issue (since many interviewees forget to probe about mix changes).
Profit = (price * quantity) - (variable costs * quantity) - fixed costs. What’s missing from the typical profit equation is the segment layer. Therefore the revised profit equation would be: by segment [ (price * quantity) - (variable costs * quantity) - fixed costs ]
Segments vary based on the nature of the case. For example, for a retail cases, the segment layer could be the different products/brands (i.e., Coke, Pepsi, 7 Up) the retailer sells in a given category (i.e., soda pop). The takeaway, always be thinking about segments: product segments, brand segments, product size segments, customer segments, etc. based on the context you're given about the case
For example, different customer segments can have different purchasing habits and behaviors, so it’s important to think about this layer.
2. Profit Variation (Revenue-focused)
Profit cases that involve revenue issues typically involve a through understanding of the drivers that relate to price changes and/or volume (quantity) changes
Revenue is money that comes into a business from customers. Revenue is usually measured by sales, and is a function of price multiplied by units sold.
Sometimes clients have multiple revenue streams across different lines of businesses or geographies. It helps to understand how these streams break down as a percentage of revenue.
A driver is something that "drives" or moves an equation. This implies movement over time. Therefore it's crucial to always be thinking about understanding changes over time when it comes to drivers of any kind. In other words, if there are two and only two things to keep in the back of your mind as you're going through any case type, it's to be thinking about segments and changes over time
3. Profit Variation (Cost-focused)
Profit cases that involve cost issues involve understanding the drivers - variable costs, fixed costs, and volume changes.
Variable costs are the cost of producing something. Variable costs include materials, labor, overhead, and other expenses that vary with production. Fixed costs are those that remain constant regardless of output. Examples of fixed costs include rent, insurance, utilities, salaries, and equipment depreciation.
New Market Entry
The market entry framework is a tool designed specifically to help you analyze the potential success of new products. This includes understanding the barriers to market entry, including product development costs, regulatory requirements, and distribution issues. You can use this tool to determine whether it's feasible to enter a particular market.
Important things to keep in mind usually revolve around exploration of the:
Company (customers, products, finances, distribution)
Market (growth, trends, key players/market share)
Financials (revenues, costs, investment costs)
How to enter the market (scratch, JV, M&A)
New Market Product Launch
The next common case type to be prepared for is New Product Launch. This is a common angle of a growth strategy case, where the client chooses an organic growth option which involves launching a new product. Important things to keep in mind usually include:
Customers (new/existing, size, type, growth)
Product (benefits, differentiation)
Marketing (budget, relative to competition)
Distribution (types, size)
Operations
While an operations case type is less common to see among strategy consulting firms, it may show up on occasion. Often times there is an operations angle to a profit case focused on cost reductions.
For example, if a client wanted to reduce costs around its operations (i.e., people, process, technology), one should keep in mind:
Company (people, process, and/or technology costs)
Competition (relation to competition)
Opportunity for savings (when moving to a more competitive benchmark)
Mergers & Acquisitions (M&A)
The merger and acquisition framework is a tool designed for analyzing mergers and acquisitions. This includes understanding the benefits of acquiring another company versus starting up a business from scratch, as well as the risks associated with each option. You can use this to determine which strategy would work best for your client. You'll want to first understand the 1) Rationale for buying and 2) Anticipated benefits/synergies
Once you have that context, you can then proceed to explore the:
Company/Client (product, customers, be on look out for synergies)
Industry (market segmentation, growth, competitors/share, profit margins)
Target Company/Client (market share, growth, profit margins, customers, distribution)
Feasibility (client experience, economics, cultural factors)
Mergers and acquisitions can result in revenue synergies and/or costs synergies.
Common revenue synergies include: Having access to new customer segments, having access to new markets, having access to new distribution channels, cross-selling opportunities, and up-selling opportunities .
Common cost synergies include: Eliminating cost redundancies, consolidating functions or groups, and increasing buying power with suppliers, manufacturers, distributors, or retailers .
Growth Strategy
The next common case type is growth strategy. These are the types of cases that you most often associate with the major management consulting firms - especially the MBBs.
Growth cases usually revolve around revenue, so recall the drivers: price and volume.
Therefore, you'll want to focus on:
Price (comparison to competitors, customer sensitivity)
Product (mix, growth, drivers of customer satisfaction)
Marketing (channels, activities, budget, effectiveness)
Financials (available funds)
Then assess the type of growth strategy: 1) organic or 2) inorganic growth
Organic includes:
Increasing/switching distribution channels
Expanding product lines
Entering new markets
Increase marketing spend and/or effectiveness
Cross-sell or up-sell with existing customers
Lower churn (especially if a SaaS - Software as a Service or subscription business that involves recurring monthly/annual revenue streams like cable or internet providers)
In-organic includes accomplishing the above via a Joint Venture (JV) or an acquisition.
Pricing Strategy
The pricing framework is a tool designed primarily for businesses selling goods and services. This includes understanding the factors that influence price, including cost structures, competition, customer preferences, and supply and demand. You can use this information to set prices and make decisions about the most appropriate pricing strategies.
For example, if you set the prices too low, you might lose out on some potential profits by not charging enough for your products.
This one is a bit more rare, but you should still be prepared.
Here, you'll first want to understand:
Company (products, market prominence, objective)
Product (differentiation, alternatives/substitutes)
Then, you'll want to select your pricing strategy:
Competitive analysis (price, product comparability)
Value-based pricing (determine willingness to pay by customer type/segment)
Competitive Threat
In this last case type, you typically need analyze what your client should do in response to a major competitor's strategy or to anticipate what competitors will do in response to a strategy implemented by your client.
Most often the case, it's around what your client should do in response to a competitor action.
It's important to first get a good understanding of the current situation. This includes an understanding of what the competitor "changed."
For example, this could be a major new product launch or major new pricing initiative.
In the case of products, for example, you'd want to probe on:
Comparison to client offering (feature/benefit comparison)
Customers (importance of new/different features, size/segments)
Competitive positioning (higher or lower price, customer target)
Market Sizing
There are two different market sizing frameworks or approaches:
Top-down approach: start with a large number and then refine and break down the number until you get your answer
Bottom-up approach: start with a small number and then build up and increase the number until you get your answer
To create your market sizing framework, simply write out in bullet points, the exact steps you would take to calculate the requested market size or estimation figure.
Less Common Frameworks in Case Interviews
The following are less common frameworks that you’ll find in case interviews. It’s helpful to be familiar with them, but they will often not be the primary structure for solving the business problem in the case interview.
Porter's Five Forces
The Porter's five forces framework is a tool designed especially for businesses operating in highly competitive industries. It is one of the most well known business frameworks.
This includes understanding the competitive environment, including industry dynamics, substitutes, buyers' power, suppliers' power, and rivalry. You can use this knowledge to identify opportunities and threats to your business.
SWOT Framework
The SWOT framework is a tool designed particularly for businesses planning to start up new ventures. This includes identifying strengths, weaknesses, opportunities, and threats. You can use this data to create a strategic vision for your client.
Value Chain Analysis
The value chain analysis framework is a tool designed specially for businesses involved in manufacturing. This includes understanding the various stages of production, including raw material procurement.
Marketing Strategy
Marketing strategy is a process of defining what you want to achieve through your marketing efforts. It involves setting goals, creating a marketing plan, and executing it. A good marketing strategy will help you achieve your goals while also providing an opportunity for growth, based on the company's customer base and target markets. Ultimately, this helps define and execute growth opportunities for the company.
Mini-Frameworks
Mini-frameworks, like larger ones, are tools designed specifically for certain types of businesses. They include the following. Considering these as supplements for larger structures
4 P's Framework
The 4 P's framework is a tool designed principally for businesses involved in marketing. This includes understanding the four Ps of marketing, including product, place, promotion, and price. You can use this insight to plan effective marketing campaigns. This is also referred to as the marketing mix.
Customer Journey Map
A customer journey map is a tool designed for businesses with a focus on customer experience.
Business Model Canvas
The business model canvas is a tool designed for startups and small businesses. This includes understanding the different components of a business, including its purpose, structure, processes, activities, resources, and relationships.
Product Roadmap
A product road map is a tool designed primarily for businesses developing new products or services. This includes determining the main features of a new product or service, such as its target audience, competitive advantages, and market position against completive products, and product adoption in the market.
PEST + G
Helps you think through factors that could impact the client’s business:
Political issues
Economic issues
Societal issues
Technological issues
Governmental issues
BCG 2 x 2 Matrix Framework
This framework is known as a 2x2 matrix. It classifies each category according to two different factors: Growth rate and Share relative to the competitors. The 2x2 matrix used in the business world, is BCG's "Growth-Share" matrix, which uses growth rate and share as deciding criteria.
McKinsey 7S Framework
A tool developed by McKinsey for analyzing organizational performance.
Victor Cheng / Business Situation Framework
The 3C’s business strategy toolkit helps with business strategy, consisting of three main parts: Company, Customer, and Competition. The Business Situation Toolkit, created by Victor Cheng, adds Product as an additional part. This combination of parts works best when focusing on understanding both the core aspects of the client and the competitive environment. It covers both internal and external factors in business strategy.
Non-Profit Framework
The non-profit framework is a tool used to analyze a nonprofit organization. This includes understanding the mission of the organization, how it operates, and who it serves.
Structuring the case is one of the most intimating and challenging aspect for most consulting candidates.
Framework Strategies and Tips
Here we are going to cover the top strategies and tactics for success as well as the common pitfalls to avoid.
There are three strategies on how to have a great case structure
1) Deeply understand the question and case context
Write down key pieces of case set-up
Jot down the question(s) and underline keywords
2) Identify the relevant 1st level issues
Spend time really thinking about the problem
Check for the hits to help uncover relevant topics
3) Recognize and contextualize the 2nd level drivers
Talk through the drivers to show that you have a deep understanding of the problem
Think about 2 common layers - segments and changes over time
Here are the pitfalls to avoid
Using too broad of a framework
Using a “canned’ framework - this means just memorizing a framework and not customizing / tailoring it based on the case context
Talking about drivers in isolation
Summary
In the real case interview, your ultimate goal should be on how to build custom frameworks but having these in your "muscle memory." Once you've understood the frameworks, you can then tailor them during the problem structuring part of the case interview.
Enhance your business acumen. Read Business Week and then see how to take some of these frameworks and customize them on the fly to build your practice.
he case context. You need to think about what type of problem you're solving.