An operations case is a popular case with consulting firms with a strong operations arm. Examples of such firms include Kearney, BCG, and Deloitte to name a few.
Operation consulting case interview categories
The are generally four categories of operations cases:
- Production optimization
- Process improvement
- Cost cutting
- Forecasting and capacity planning
In this article we will cover a general approach that can be adapted to any of these main categories of operations cases.
The first step in any case is to understand the client’s situation and the goal they are trying to achieve.
Production optimization case
In a production optimization case, the client would be looking to increase the rate of production for a good. You would want to understand what that rate/goal would be.
There are two formulas that you would need to consider:
- Rate * Time = Output
- Output/Maximum Output = Utilization
Once you have established the rate that needs to be achieved, you can consider ways to increase production:
- Upgrade current equipment
- Reduce factors that slow existing equipment
- Add new technologies
- Add new production processes
Another way to increase production is to increase utilization. Consider if the current machinery and manpower is utilized in the most efficient manner. You can also consider ways to add capacity.
Once you have hypothesized the best methods for improving production, make your recommendation proposal which includes the quantified changes to production to the interviewer.
Process improvement case
In a process improvement case, the interviewer would be looking for you to improve a particular process.
First step again is to understand the client’s goals and performance metrics.
The second step is to break down the process provided by the interviewer into separate components which can be independently analyzed.
Each component has people, processes, and technologies that are part of it:
- People – Are the right number and type of people involved in that given component?
- Process – Are the correct steps being performed?
- Technology – Is the right technology in place?
When giving your recommendation, mention the impact on the performance metric by each of the components and the proposed changes to the people, processes, and technologies.
Cost cutting case
In a cost cutting case, the goal is to help the client reduce it costs to meet its budget.
As always, ask and determine the clients goal for this case. By how much are they looking to reduce costs?
The next step is to determine the costs of the components for the client. There will be fixed costs and variable costs. These can be further broken down by product, process, or function. Ask for figures on what costs there are.
Identify the business critical expenses that cannot be ceased. These are the costs that need to take place for the client to exist.
Next step is looking at discretionary spending. This is any spending that is not necessarily required for the business to function. List out these costs from the largest to the smallest.
Prioritize the areas with the most opportunity for cost cutting that has the least impact on the firms operations.
Finally give you recommendation and propose how they would help meet the clients goals of brining costs in line with the budget.
Forecasting and capacity planning case
In a forecasting and capacity planning case, the goal is to help the client determine how much product to product and inventory to hold.
First step again is to understand the client’s goals and performance metrics.
The next step is to estimate the customer demand for the client’s products. This can be done with:
- Company historical data
- Demand curves for similar products
- Market and competitor trends
- Customer survey data and purchasing habits
After this, you will need to understand the underage and overage costs of carrying or producing their products. The client needs to balance producing too much or too little inventory.
This is then followed by determining the optimal production and inventory levels for the client’s products. This should take into account the overage and underage costs from earlier.
About PrepareConsult:
PrepareConsult is a platform to practice the consulting case interview with AI and peers. PrepareConsult is founded by Milad Mohammadi and Sahhas Nathella.
Milad Mohammadi – 7+ years of experience in consulting and professional services with experience across North America and Europe.
Sahhas Nathella – 5+ years of experience in consulting and professional services with strong experience in complex digital transformations.
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