How to get into management consulting

1
How to get into consulting?
Practical guide how to pass the case part

2
Management consultants are brutally efficientOnly 5% of candidates get accepted to consulting

3
You will learn how to solve cases during the
job interview to increase your chances of
getting the job

4
Useful
techniques that
you should
master
Market
estimation cases
Sales and
marketing cases
Strategic cases
Operational
cases
Recruitment
process
In this presentation I will show 6 things

5
This presentation will help you land a job in consulting or as a
business analyst

6
More cases you can find in my on-line course where I
show step by step how to solve cases
Click to check my course
How to get into consulting –
Management Consulting Cases
$45
$15

8
The ideal consultant has some important characteristics that
help him survive the hostile environment he is usually working
in
Analytical mind
Good at structuring and
simplifying problems
Good listener that can
easily interact with
people
Independent
Fast
Diligent and hard working
Resilient / Robust
especially to stress
Good presentation skills
Open-minded
Computer literacy at least
at average level

10
How does the recruitment
process look like?

11
The recruitment process is pretty long and the chances are
relatively small. Only 5% of those that take the math test get
the offer
Math /
Analytical
Test
Interview
with HR
1st
interview
with a
consultant
2nd
interview
with a
consultant
3rd
interview
with a
consultant
Last interview
– Partner /
Director
100% 30% 25% 20% 15% 5%
% of candidate
that move to
next phase

13
There are things that you look for when you are browsing
through the CVs
Top universities
Top performer
Languages
Internships
Living / Studying
abroad
Additional project i.e.
student organizations
Computer literacy

14
Most management consulting workers are recruited from
business schools or exact science departments
Business Schools and
Department of
Economics
% of all candidates
▪ 70%
% of all workers
▪ 50%
Exact science (math,
physics, computer
science
▪ 15% ▪ 30%
Medicine ▪ 5% ▪ 10%
Others ▪ 10% ▪ 10%

15
Types of questions that
you may expect

16
There are 6 main types of questions you will get during the
interviews
Market size
estimation
Sales and marketing
cases
Strategy cases
Logical math quizzes
Operations cases
Managing people
cases

17
Alternative ways to get into
consulting

18
Recruitment is not the only way that you can get into consulting
Comments
% of candidates
recruited
Direct recruitment to
specific position
▪ Used especially by big consulting firms▪ 50-70%
Internships
▪ Helps you progress faster later
▪ Can require also formal recruiting but more lenient
than the usual one
▪ 10-30%
Closer cooperation with
students and student
organizations
▪ You can help consulting firm organize in events,
participate in them
▪ Bigger firms have their brand ambassadors on
universities
▪ 10-30%
Closer cooperation with
the universities
▪ You can get involved in the cooperation
▪ Usually helps you at least to get internship at the firm
▪ 10-30%

19
Useful Techniques that you
should master before the
interview

21
…the one you will for sure use is bottom-up approach where
you go from single (typical) consumer to market research
▪ First you should
imagine the
typical users
▪ Then you should try to
guess his consumption
level
▪ By estimating the number of
typical users you and their
consumption level you get
the rough size of the market

22
…sometimes it makes sense to divide markets in segments and estimate
them separately (i.e. average and typical users, women and man, people
in different age groups or segmentation by lifestyle)
Segment A
Segment B

23
…lets do a simple example. Imagine that you want to make an
application for franchised restaurants
▪ You pick the sample
group / area you want
to estimate i.e. city
(here Warsaw)
▪ You count the number
of all restaurants in the
area
▪ For the chosen area
you count the
franchising restaurants
▪ You check the population of
the whole country – here
Poland
▪ Assuming similar density as in
Warsaw you scale up the number of
franchised restaurants
proportionally to the population

24
…to make you better at this method imagine you want to sell
home made dog food….. First you have to estimate how many
dogs they are…..
▪ First you should pick
your sample – can be
your friends or
neighbors
▪ Next step is to calculate
how many dogs they
have
▪ Once you have the number also
calculate how many households they
are in the sample
▪ It is now enough to know how
many households there are in the
country
▪ And assuming similar proportion as
in your sample you scale up the
number of dogs
+

25
…with the number of dogs you just have to estimate the
number of food eaten per year by average dog…..and you get
to the size of the food market
▪ We have the number of dogs in the
whole country. Now we have to get
from here to the dog food
▪ This requires us to estimate additionally how much
food would average dog eat per year
▪ In this way using annual average consumption per dog and the
estimated number of dogs we are able to estimate how much food is
eaten every year in the country
+

26
Lets sum up the bottom-up approach
▪Bottom-up approach enables you to estimate within
one minutes the indicative size of the market
▪It is very good for the B2C markets
▪For better estimation you should segment customers
and increase the sample size

28
When to use top-down approach?
▪You know the size of the whole market
▪You are interested in a specific segment of the
market
▪Segment is big enough
▪You are thinking about niche strategy or low cost
strategy (market re-segmenting)

29
For a change lets see how it would work with top-down
approach
▪ You use the total market size
to get to the size of the
segment in which you are
interested
▪ You have to use some
sort of sample
measure
▪ By applying the result from
the sample you can get to
the size of the segment in
which you are interested

30
… let’s use the top-down approach to estimate the market for
science fiction books sold in Poland….
▪ You use the total number of books sold in your
country
▪ Then you go to the bookstore that belongs to the biggest
chain of bookstore and check what percentage of the
shelves are take by science fiction books
▪ If you use this proportion to the whole market you should
get the rough estimation of the science fiction book
segment

32
Imagine that you were supposed to say how much you have to
spend to create a company that has revenue of $ 100 M dollarImagine that you were supposed to say how much you have to
spend to create a company that has revenue of $ 100 M dollar

33
You could use for that the so called backward reasoning
CC: Flickr; Cycle Track

34
Imagine that you were supposed to say how much you have to
spend to create a company that has revenue of $ 100 M dollar
Total Costs
$ 400 M
Cost of 1 lead
$ 2 K
# of leads
200 K
÷
% Conversion
10%
x # of customers
20 K
Average revenue
per customer
$ 5 K
Revenues
$ 100 M
x

36
There are 2 types of compounding effect
Time related Operations related
▪ Even if the growth is small applied over long period of
time gives big end-results
▪ A lot of small changes in many areas may produce a
big end-results
# of customers Average revenue per
customer
Revenues
x
+15%
+20%
+38%
= 2,6 x StartStart x (1+10%)^10

38
Issue tree - general
Area of analysis
Area 1
Problem 1
Problem 2
Possible Reason 1
Possible Reason 2
Possible Reason 3
Possible Reason 4
Possible reasonsSuspected problems
Analysis to be
performed
Analysis 1
Analysis 2
Analysis 3
Analysis 4

39
Issue tree – example – chicken meat producer
Area of analysis
Transport
High costs of transport per ton of
goods
Big level of waste and breakage in
transport
Possible reasonsSuspected problems
Analysis to be
performed
Analysis of correlation between type of
packaging and percentage of damaged
Analysis of time spent on the way and
kilometers covered in that time
Analysis of designed routes, their length
and the influence of possible changes
Analysis of fuel usage and kilometers
covered by vehicles
Analysis of load carried on the way back
Badly designed routes
Too big fuel usage
No shipments on the way back
Low usage of resources
Badly designed method of packaging
which makes the product prone to
damage
Speed not adjusted to the product
Badly organized work and schedule of
deliveries
Limitation on delivery time of finished
goods
Analysis of level of overtime, daily
organization of drivers work
Analysis of Clients’ preferences on delivery
time

41
Opportunity tree
Gross Margin
Sales
% Gross Margin
% Front Margin
% Back Margin
# of transactions
ATV
Traffic
% conversion
▪ YouTube
▪ Ads on instagram
▪ Affiliation with bloggers
▪ Guest blogging
Opportunities
▪ Long form / Short form
▪ Reduction of delivery methods
▪ No account
▪ Emailing for people abandoning cart
▪ Upselling and Cross selling
▪ Free delivery for higher tickets
▪ Introduction of new categories
▪ Reducing number of suppliers
▪ Finding new suppliers
▪ Renegotiation

43
Cost drivers are causing the cost to go or down
Cost of a Udemy course
Slide preparation
Recording and editing
# of slides
Cost of 1 hour
# of hours per 1 slide
# of lectures
Cost of 1 hour
# of minutes per 1 lecture

45
* Sort,Set,Shine,Standardise,Sustain
** Total Productive Maintenance
*** Overall Equipment Efficiency
Kanban Kaizen Poka Yoke
Produkcja
gniazdowa
Zero defectsOEE***TPM**SMEDJust in time
Process
mapping
Continuous flow
management
Standaryzacja
pracy
Heijitsu box
5S*
Lean Manufacturing is a philosophy of working with little waste and highest
quality. It consists of many techniques that should be gradually mastered

47
Overall Labour Efficiency how much work there is in the work
☺?
Workday
Time that you can devote
Time left for real workLack of work
100%
54%
OLE =
100 %
54 %
x
x
98%
Work
98%
37%
No work due to
organizational
issues
Movement
70%
Work well done
70 %
Liczba
dostępnych
godzin
lalka Stawka Godzinna
Dodatkowe
przychody

49
Bottlenecks are dangerous as their hurt the efficiency of the
whole system

50
What is the throughput of every system and where
is the bottleneck?
Example 1
7 5 7
Example 2
5 10 20
Example 3
5 5 3
x Stage capacity

51
The are 4 rules that you should follow when it comes to
bottlenecks
▪ Identify what is the bottleneck
▪ Increase its throughput by lowering the time needed for
everything that goes through the bottleneck
▪ Add new resources to bottleneck
▪ Adjust everything to the bottleneck – so it works at the
same pace

52
Imagine that you are working in a company working in a
content marketing
Research topics for a
post
Write a post Create illustration
Edit and modify
post, add illustration
and schedule
20 5 7 10
# of post that can
be done in a week
by 1 person
▪ Speed up the writing process (faster typing,
better tools, shortcuts for the most popular
words)
xx
20 8 7 10
10 9 10 10
▪ Make the researcher do also par time
writing and making illustration
▪ We have almost doubled the production of post with the same resources
▪ The same principles would apply if all the activities were done only by you – in this case it would mean that you
should not do too much research and illustration but rather improve the typing speed and match the number of
illustration and researches to your capacity in writing
▪ If you have no impact on the process (you are one of the guys above just doing his own part and your boss does not
want to listen to you then simply do less – identify the bottleneck and adjust your speed to his speed.
▪ On the other hand if you are the bottleneck then speed up because the whole team depends on you.

54
Market size estimation -
Introduction

55
In those sort of cases they want to check a few things
▪ Can you structure a problem?
▪ How do you behave when confronted by things that
you know nothing about?
▪ How do you fill in the gaps?
▪ Your approach to analyzes?

56
I will show you few examples

57
I recommend going on your own through cases before seeing
the solution
Go through the
lecture with the
tasks and
questions
Pause the
course for 5
minutes and try
to solve the
problem on
your own as if
you were in a
real interview
Go to the next
lecture with
solution and go
carefully
through it
Before going to
next lecture
compare your
answer with
what I have
shown in the
solution
Proceed with
the next case

59
Imagine that you were asked to estimate the market for TV
sets
What is meant here by
“the market”? Annual sales
or total ownership?
What is included in the TV
sets (i.e. monitors are in or
not)?
Do you want the market
estimation to be in
volumes or in values?

60
Let’s start by finding the main drivers for TV sets. We assume that it
depends on the number of families. If we have the number of
families and the number of TV per family we an estimate how many
TVs are owned
# of families
# of TV set per
family
# of TV sets
owned by all
families
x

61
To get from TVs owned to the number of TVs bough every year
we need to assume how often TV are replaced
# of families
# of TV set per
family
# of TV sets
owned by all
families
x
# of years of
usage of a TV
sets
÷
Number of TV
sold during the
year

62
Once we have the number of TV sold we can calculate the
value of the market
# of families
# of TV set per
family
# of TV sets
owned by all
families
x
# of years of
usage of a TV
sets
÷
Number of TV
sold during the
year
Average price per
TV
Value of TV sets
sold during the
year
x

63
If you do not know the number of families you can estimate it using
the total number of people
# of families
# of TV set per
family
# of TV sets
owned by all
families
x
# of years of
usage of a TV
sets
÷
Number of TV
sold during the
year
Average price per
TV
Value of TV sets
sold during the
year
x
Total population Average size of a
family
÷

64
Below how it would look like for Poland
10 M families in
Poland
1 TV set per
family
10 M TV sets
owned
x
Every 4 years
replacement of
TV set
÷ 2.5 M of TV sets
sold annually
USD 1 000 per TV
SET
USD 2 500 M of
sold TV sets
x
40 M people in
Poland
4 people per
family
÷

65
$45
$ 15

67
Sales and marketing cases-
Introduction

68
In those sort of cases they want to check a few things about
you:
▪ What is your general knowledge about sales and
marketing?
▪ How analytical and goal-oriented you are when it comes
to sales?
▪ How innovative you can be in sales / marketing?
▪ Are you a good sales / marketing person?

70
Imagine that as a consultant you were asked to analyze your client situation-
FMCG producer that is using different channels of distribution. How would
you check whether his using the right mix channels
Own shops
Retail chains
E-commerce
Marketplaces
Wholesalers

71
How would you check whether his using the right mix channels
What “right means”?
What metrics you should
look at to decide on the
right mix?
What are the strategic
goals?
What would you do – next
steps?

72
How would you check whether his using the right mix channels
What “right means”?
▪ Right = the most profitable
▪ Right = the most profitable, still close to the structure market
look at to decide on the
right mix?
goals?
steps?
▪ Net margin per channel
▪ % Net margin per channel
▪ Market share of specific channel
▪ Number of customers or middlemen in a specific channel
▪ % of revenues in a specific channel generated by top 3 players
▪ Have higher share in channels experience high growth and have chances to become
significant in the next 3 years
▪ Have higher share in channels that are not consolidated and the middlemen or the
customer does not have significant purchasing power
▪ Step 1: Get the data on sales, COGS and direct and indirect channel costs
▪ Step 2: Calculate the profitability on all levels for all channels
▪ Step 3: Get the data on the market: % share of specific channel, number of players in
the specific channel, % of revenues in a specific channel generated by top 3 players
▪ Step 4: Find out the strategic goals
▪ Step 5: Compare and decided on targeted mix of channel

73
Potential for growth -
retailer

74
Imagine that you are retailer with 200 stores in the whole
country.
Gdańsk
Szcecin
Bydgoszcz
Poznań
Wrocław
Katowice
Łódź
Kraków Rzeszów
Kielce
Lublin
Warszawa
Białystok
Gdynia-Sopot
Gliwice
Olsztyn
Opole
Zielona
Góra
Current number of stores

75
How you would estimate the potential for growth?
What “growth means”?
▪ Build new store
▪ Like For Like growth (LFL, L4L)
use to decided whether to
build a new store in a
specific place or not?
goals?
steps?
▪ You should first establish the capture area for every type of store. It can be defined as
an area or number of potential customers
▪ Define the expected profitability per store
▪ For every city you should calculate the number of stores at the saturation point
▪ Is the Retailer willing to sacrifice profitability just to capture more market share?
▪ What market share it aims at?
▪ What are his limitation in-terms of capex
▪ Step 1: Get the data on number of stores per city, population per city and data
needed to calculate the saturation point (i.e. the minimal number of customers per
store)
▪ Step 2: Calculate saturation point per every city
▪ Step 3: Compare the current number of shops with the saturation point
▪ Step 4: Decide on the basis of saturation point and strategic goals what to do

76
Below how we would calculate whether it makes sense to build a
new store in a specific city
Total population
in the city
Minimal number
of population
per shop
Number of
shops at
saturation point
Current number
of stores
÷
Built new shops till
saturation point if
you have money
>
Don’t build any new
shops in this
location
<

77
If we were talking about Warsaw we could see the following picture
1 000 K people
in Warsaw
We need at least
100 K per store
10 6
÷
÷
÷
We can build 4 new
stores but we have
money only for 2
>
We haven’t reached
saturation point
<

78
Number of stores by provinces
Gdańsk
Szcecin
Bydgoszcz
Poznań
Wrocław
Katowice
Łódź
Kraków Rzeszów
Kielce
Lublin
Warszawa
Białystok
Gdynia-Sopot
Gliwice
Olsztyn
Opole
Zielona
Góra
Targeted number of stores
Current number of stores

80
Imagine that you are a Retailers with 10 stores and very strong
brand that are selling toys. How would you grow the business
Off-line retail chain Selling Toys

81
There are plenty of things you can do. Below some examples
Open more stores if
below saturation point
Work on improving LFL
Introduce private label
Add new categories
for kids i.e. Fashion
Enter new channels
i.e. on-line
Grow by franchising
your concept
Creating new formats
i.e. Store in Store

82
$45
$ 15

85
Imagine that you were responsible for managing the cinema.
What KPIs metrics you would look at to see whether you are
doing a good job?

86
You should first start by estimating the revenues of the cinema
you are managing
# sold tickets
Average revenue
per Ticket
Total revenue
x

87
Average revenue per ticket depends on the price of the ticket as well
as average additional purchase are people making
# sold tickets
Average revenue
per Ticket
Total revenue
x
Average price per
ticket
Average additional
purchase per ticket
+

88
Number of sold tickets depends on the capacity of the cinema
(number of potential seats) as well as the percentage utilization of
this space
# sold tickets
Average revenue
per Ticket
Total revenue
x
Average price per
ticket
Average additional
purchase per ticket
Total capacity in
tickets
% Utilization
+
x

89
On the cost side we have rent and the salaries of the people
# sold tickets
Average revenue
per Ticket
Total revenue Total Costs
x
Average price per
ticket
Average additional
purchase per ticket
Total capacity in
tickets
% Utilization
Rent
People +
+
x

90
Salaries depend on the number of people and average wages
# sold tickets
Average revenue
per Ticket
x
Average price per
ticket
Average additional
purchase per ticket
Total capacity in
tickets
% Utilization
Rent
People
# of People
Average wages
+
+
x
x

91
When we deduct from the revenues the costs we get roughly the
EBITDA of the cinema that you manage
# sold tickets
Average revenue
per Ticket
x
EBITDA per cinema
-
Average price per
ticket
Average additional
purchase per ticket
Total capacity in
tickets
% Utilization
Rent
People
# of People
Average wages
+
+
x
x

92
Once you have all the KPIs and you can start wondering how to
increase the EBITDA of your cinema
# sold tickets
Average revenue
per Ticket
x
EBITDA per cinema
-
Average price per
ticket
Average additional
purchase per ticket
Total capacity in
tickets
% Utilization
Rent
People
# of People
Average wages
+
+
x
x

94
IKEA is a well know brand selling furniture. On what do you think
they make their money? Think about this and move to the next
slide

95
IKEA has been very successful in implementing low cost
model in furniture. Below how they did it
Model „big box” built outside the city
center
Design
Consistent message
Diversified revenue streams
Operational excellence
Business scale
Retail
Acquisition
Activation
Retention
Revenue
Referral

96
$45
$15

99
Imagine that you have 9 balls. One of them is slightly heavier. You have
weights with scale that you can use 2 times

100
First you have to divide the balls in 3 groups
Group A
Group B
Group C

101
Then put two groups on the scale. Let’s imagine that you put Group A and
Group B
Group A Group B

102
If the scale stay in balance it means that the heavier 1 ball is in group C
Group A Group B

103
If the scale is tilting at the group A side it means that the heavier ball is in
group A
Group A
Group B

104
If the scale is tilting at the group B side it means that the heavier ball is in
group B
Group A
Group B

105
Group A
Group B
Group C

106
Let’s assume that the scales were in balance. We get rid of group A and B. Every
ball in group C gets its own unique number C1, C2, C3. We put C1 and C2 on the
scales. If the scale remain in balance it means that C3 is heavier. If the scales tilt
at whatever side the tilt is this will point to the heavier ball
C1 C2

107

108
To sum up we did it in 2 phases. In the 1st one we got rid of 6 balls. In the
2nd one we got the heavier ball out of three
Group A
Group B
Group C
C1 C2 C3
Phase 1 Phase 2

110
Content marketing agency -
how to increase it's output?

111
Imagine that you are working in a company doing content marketing.
How much post they can make and how you could improve it?
post
Edit and modify
and schedule
20 5 7 10
# of post that can
be done in a week
by 1 person
xx

112
Imagine that you are working in a company working in a
content marketing
post
Edit and modify
and schedule
20 5 7 10
# of post that can
be done in a week
by 1 person
▪ Speed up the writing process (faster typing,
better tools, shortcuts for the most popular
words)
xx
20 8 7 10
10 9 10 10
▪ Make the researcher do also par time
writing and making illustration
▪ We have almost doubled the production of post with the same resources
▪ The same principles would apply if all the activities were done only by you – in this case it would mean that you
should not do too much research and illustration but rather improve the typing speed and match the number of
illustration and researches to your capacity in writing
▪ If you have no impact on the process (you are one of the guys above just doing his own part and your boss does not
want to listen to you then simply do less – identify the bottleneck and adjust your speed to his speed.
▪ On the other hand if you are the bottleneck then speed up because the whole team depends on you.

113
It will take you around 20 minutes to get to the cash till
Number of
people in the
queue
Time per 1
customer
Number of
cash tilts
32 2.33
30 23 20.0
Time you will
wait
In min
23.4
Number of people in
the queue
x
Number of cash
tilts
Time per 1 customer

114
show step by step how to solve them
$45
$15

115
You can also find useful some tips on Excel
Essential Excel for Business
Analysts and Consultants
A practical guide
presentation

116
Check also business modeling in Excel
Business models
Practical guide for startups and entrepreneurs
presentation

117
I recommend also looking at some techniques to improve
your business. Click on the cover below to go to the
presentation
How to become world class
analyst
A practical guide
presentation

118
….and how to perform market research
Market research
Practical guide for startups and entrepreneurs
presentation

119
Subscribe to our channels:
www

120
Check my extensive presentation on productivity hacks to see
how you can me 10x more productive
Management consultant
productivity hacks
How to be lazy and still get things done
presentation

121
If you need more detailed version on productivity hacks you
can check our course on productivity hacks
Management Consulting
Productivity Hacks
$45
$15

122
Check my presentation on restaurant business model to
understand it properly
How to open a successful
restaurant
A practical guide
presentation

123
Check my presentation on on-line models to understand
them properly
On-line Business Modesl
A practical guide
presentation

124
For more check also my on-line course
On-line Business Models in Excel –
Practical Guide
$45
$15

125
Check my presentation on starting and running consulting
company
Start and run consulting
company
A practical guide
presentation

126
There is an interesting summary of ways to test cheaply
businesses
MVP – how to test your business
idea without building the
product
A practical guide
presentation

How to get into management consulting

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