Problem Driven Structure: tackle cases like a real consultant

The problem-driven structure, accompanied by an appropriate issue tree, is the case-solving tool developed by MyConsultingCoach as a streamlined version of the actual method working consultants use on projects. As a result, problem-driven structures are wonderfully flexible, allowing you to rationally tackle any case your interviewer throws at you.

In this regard, problem-driven structures are a radical departure from the conventional "framework" based case systems found in Case in Point and similar, old-fashioned sources. Those frameworks are overly rigid, lacking the ability to take account of the complexities of real business cases which do not fit well in their idealized schemes. This makes framework methods highly unreliable in case interviews.

The problem driven structure method developed from the realization that conventional case interview prep systems are fundamentally flawed and that a whole industry had evolved around setting up diligent candidates to fail. The issue tree is an additional tool that helps you apply this method to understanding a complex problem or solving a case.

The best and most comprehensive source on problem-driven structures is the MCC Academy. Our full-length video focussing on the subject (embedded below) is just one in a whole series, explaining all aspects of how to use our method - as well as teaching crucial background information and skills such as communication and reasoning.

If you find some aspects of this video a bit tough, don't worry - it builds on the material of the previous eight full-length videos that come before it in the course. In this article, we will take a less involved approach by focussing on explaining why standard "framework" based approaches to case cracking don't work and how the problem-driven structure approach tackles cases differently.

To see how the approaches differ in practice, we will tackle the same example case using both a standard framework and our own method - presenting an issue tree showing the root cause of the problem and the potential outcomes. This will be a useful point of entry to begin to see how our approach works and how you can use it yourself.

1. The limitations of frameworks

Ask any number of consultants how often they use any of the 12 frameworks from Case in Point or any similar system in their daily work. We guarantee that - 100% of the time - their answer will be "never". This fact alone should be sufficient to set alarm bells ringing...

So what's wrong with these pre-packaged frameworks? If they're supposed to be good for solving cases, why don't working consultants actually use them?

The fundamental issue is that framework-based systems rely on the idea that the entire set of all potential business cases (across industries, geographies, size of companies, etc) is sufficiently homogeneous that it can be boiled down to a (very) small number of generic types – as all case guides do. According to a framework-based approach, any and all business problems are really just instances of one abstract scheme or another. Apparent differences are merely superficial - the underlying workings are the same. The result is that framework approaches instruct you to take whatever case you are given and simply force-fit it to one of these generic schemes..

Obviously, for this approach to actually work, the field of possible business problems really would have to be this homogeneous/predictable. Of course, we already know this is not the case from the simple fact that - if it really were so easy to solve business problems - consulting firms would simply not exist. If any business problem could be solved by simply applying one of 12 frameworks from a single book already in the public domain, then why on earth would a company bring in consultants for thousands per day!

Your interviewer will generally base the case they give you on a real project on which they have been working recently - that is, exactly the kind of case that is sufficiently complex and unique to merit hiring consultants. Your interviewers will also know all about conventional, framework-based systems. Top firms are not looking for recruits who distinguish themselves only by memorizing 12 frameworks - and so are doubly unlikely to give cases that can be easily solved with them.

Given a case that doesn't actually fit with the standard frameworks, without the adaptability to deal with a different kind of scenario, you will be stuck trying to cram a square peg into a round hole during the interview. You will have that sinking feeling of watching your consulting career slip away in front of you.

In short, then, if you want the best chance at impressing at a case interview and ultimately landing your dream consulting job, frameworks are not the way to go!

2. Problem-Driven Structures and Issue Trees

Of course, all this begs the question as to how real consultants do work - as well as how you should go about solving cases in your interview.

The answer is that consultants approach each new project on its own merits so as to be able to accommodate the unique aspects of that particular case. Their first concern will be to precisely understand the client's primary problem - that is, their overriding priority in hiring a consultant. From there, consultants work outwards in a flexible manner, always driven by the goal of addressing that fundamental, core problem (this is referred to as taking an hypothesis driven approach).

At MyConsultingCoach, we teach you how to tackle case studies in this manner, developing a unique, tailor-made "Problem Driven Structure" suitable to answer whichever case you are given - no matter how exotic it might be. When faced with a question about a business problem, we make it clear that your first thought should be “what is the single, key, most important success criterion for the client?" When the answer to this question is clear in your mind you can proceed with setting out a framework to answer that question. Ostensibly, this idea seems pretty intuitive. However, it is a radically different method to the typical one-size-fits-all framework approach.

We are upfront about the fact that our way of working requires more thought and understanding from you and will take longer to master than learning a few generic schemes. However, the additional effort required to grasp the Priority-driven Structure method is more than worth it when balanced against increasing your chances of landing your dream MBB job!

2.1. What is an Issue Tree?

An issue tree is a tool consultants use constantly, and is the graphical representation of the method you employ to break down the problem. It allows you to keep track of what you are doing and gives your interviewer insight into your thought process. The structure of an issue tree is very simple - from left to right you start with the root of the issue and break it down into its constituent components.

3. Example case analysis- PharmaCorp

We've been talking in very theoretical terms so far. However, the best way to see how the problem-driven structure method works and how this differs from a framework-based one is to see how both deal with a typical case..

Let's say an interviewer gives the following prompt:

Our client is PharmaCorp, a Dutch pharma company specializing in researching, developing, and selling “small molecule” drugs. This class of drugs represents the vast majority of drugs today, including aspirin and blood-pressure medications. PharmaCorp is interested in entering a new, growing segment of drugs called “bionics”. These are complex molecules that can treat conditions not addressable by traditional drugs. R&D for bionics is vastly different from small molecule R&D. PharmaCorp wants to jumpstart its bionics program by acquiring BioHealth, a leading bionics start-up from Silicon Valley with a promising drug pipeline.

Should PharmaCorp acquire BioHealth?

We'll show how each method deals with the same case prompt before moving on to analyze how they differ.

3.1. Using a conventional framework

To give an example of a standard approach, we will apply the Victor Cheng framework on Mergers and Acquisitions. A diligent Victor Cheng student would frame the problem in the following way:

3.2. Using a Priority-Driven Structure with an accompanying tree

Ostensibly, Cheng's approach might seem sensible enough. However, let's now compare a problem-driven structure approach. As noted, we always start by identifying the fundamental question which we must answer for our client. We need to consider what is the single, crucial piece of information we need to provide in order to answer that question.

In this case, the client wants to know whether they should acquire BioHealth. Our main objective, then, is to assess whether the expected profitability - or net present value - of the acquisition is positive. Net present value is given by the difference between the present value of future earnings - the profit - resulting from acquiring the company and the acquisition price. The present value of future earnings is the sum of:

• Present value of earnings from existing drugs
• The present value of expected earnings from pipeline drugs - We are not fully sure that drugs in development will be commercialized. Thus, we weight potential earnings by each drug's probability of getting commercialized.

4. What are the differences?

Now that we have seen how the same problem is dealt with by both a standard framework and a problem-driven structure, we can examine how the two approaches differ.

4.1. Answering the question/relevance

The most glaring difference between the two approaches as they have applied here is that the problem-driven structure quickly moves towards a clear, definitive answer to the client's question, whilst Cheng's approach does not. Our tree clearly lays out the issues and how they branch.

Cheng's approach does a fine job of generating a list of the pros and cons of making the acquisition. However, in itself, this does not take us very far towards telling our client whether they should go forward with the deal or not.

Crucially, Cheng's approach does not instruct us as to how to weigh the various factors it identifies against one another. For example, we might know that the companies expect to benefit by cross-selling between existing customers, but that this will not significantly impact either company's standing versus their competitors and that there is a small but limited amount of expertise and capacity they can share.

Where do we go from here? There is no explicit way to balance these factors against one another towards the goal of coming up with a single answer as to whether the acquisition will be advantageous overall.

By contrast, the problem-driven structure explicitly relates all the factors to one another - the way the issue tree branches represents that relation. Once the tree structure has been drawn, all we need to do is to secure the relevant data for each element of that structure and the answer emerges straightforwardly.

4.2. LOGICAL STRUCTURE

The clear relationships between elements of the priority-driven structure is a straightforward result of its logical structure. Even for the same case, there will be multiple ways to draw up a valid problem-driven structure. You can draw multiple issue trees, depending on your focus. However, all will abide by the same logical rules.

In particular, the divisions made ("segmentation") at each level of a valid problem-driven structure must always be MECE. This ensures that problem-driven structures will inherently "bake in" the kind of logical relations which are important above in moving towards solutions.

This kind of structure is completely absent from Cheng's approach, where there is no real attempt to organize the analysis.

4.3. Hypothesis-Driven Cases

We can see both the problem-driven structure's tree format, as well as how it directly addresses the client question, as ultimately resulting from the "hypothesis-driven" nature of that approach.

A hypothesis-driven mindset is a crucial and distinctive feature of consulting. You can read about it in more detail in our article here. In short, when we work in a hypothesis-driven way, we impose structure on an issue so that we can quickly focus only on whichever factor is most relevant to answering our own questions, excluding all other considerations.

Under Cheng's approach, we begin with a long list of factors to analyze, with no idea how many will turn out to actually be relevant to answering the question. With the problem-driven structure, however, your issue tree is built out as you move through the problem from the initial question. New branches are added only as you decide that they might be relevant. This helps to avoid redundant analysis of factors that later turn out to have been totally irrelevant to answering the question.

With a problem-driven structure, everything you do is inherently related back to the main question - the client's primary concern. By contrast, a standard framework simply applies a pre-existing, abstract structure from Mr. Cosentino's or Mr. Cheng's imagination and then attempts to bridge the gap to the client's actual concerns as an afterthought.

4.4. Adaptability

It might not be as immediately obvious from examining a single case study, but a major advantage of the problem-driven structure is how much more adaptable it is to different issues than framework-based approaches.

Cheng's approach simply gives us one way to think - which may or may not be applicable to the case in hand. With our approach, for any given case, it should be possible to generate more than one distinct problem-driven Structure (and the accompanying issue tree) suitable to give a solution to the client's specific concern.

Multiple different valid structures are possible because, as we draw up our issue tree, we will be able to segment issues in different ways, represented by the branches of the tree. This means that we can choose the segmentation that makes best use of the data we have access to and which will make our calculations most straightforward.

In our video lesson on problem-driven structures (embedded at the beginning of this article), we work through the same case study in two different ways, building two different structures.

Of course, the adaptability of our approach comes at the cost of requiring more thought from you, the candidate. With a variety of options available, you will need to have an idea of how to choose between them, starting from understanding the root of the issue.

This is something that we take you through in the MCC Academy, as well as in various articles here, including the those on segmentation and MECE - though you will also develop more instinctive feel for these choices as you practice more cases.

Relying on frameworks means that you might be lucky and get a case that fits perfectly with one of the generic schemes from whatever system you have learned. However, when a case does not fit, you will be stumped. Making use of the problem-driven Structure is then absolutely worth the additional cognitive effort for the fact that you will be able to tackle any case your interviewer throws at you.

4.5. Communicating problems and solutions

The importance of communication in consulting interviews cannot be overstated. A candidate can crack all the cases they like, but no consulting firm will give them a job if they can't communicate. The differences which we have already observed between the problem-driven structure and framework-based approaches profoundly shape how candidates using those approaches will communicate with their interviewers.

By contrast to the unstructured "laundry lists" we have observed with Cheng's framework-based method, the issue trees used by the problem-driven approach help to properly structure how you communicate with your interviewer. This will help you convey a clear, focussed, hypothesis-driven mindset.

In particular, the MECE segmentations and overall very logical analysis associated with a problem-driven structure help to avoid redundancy in questions asked of the interviewer. Having taken this approach will also make it easier to supply recommendations in an appropriately structured manner (see our articles on client recommendations and the pyramid principle).

This structured approach also helps to keep your interviewer clear as to where you are in your analysis. Besides the need to prove your communication and reasoning skills by explaining your rationale to your interviewer, it should also be borne in mind that interviewers will often give promising candidates a nudge in the right direction if it seems they are drifting off course. This will not be possible if your interviewer has lost track of what you are doing.

As basic as it might seem, the same structured approach that prevents your interviewer from getting lost is also important to stop you getting lost. Many candidates will get tangled up in their own reasoning or get distracted by pursuing some tangential problem. The problem-driven structure makes this less likely to happen - the issue tree is the physical representation of your thought process, allowing you to easily check the root and branches, preventing you from entangling yourself.

For a more comprehensive discussion of the ways in which problem-driven structures can enhance your interview communication, check out the communication section in our article on the hypothesis-driven approach.

5. Are frameworks totally useless in solving problems?

Of course, the industry that has grown up selling framework based approaches would not have survived for so long if there was not something positive interview candidates could take from them. If you are reading this having already invested some time in getting to grips with one or more framework approaches, then don't worry - your time hasn't been entirely wasted!

Most usefully, the general business knowledge gained from generic schemes can help inform building priority-driven structures and might be a source of ideas when brainstorming solutions to problems. Thus, frameworks are better thought of as examples that might be drawn upon for ideas, rather than foolproof analytic procedures. For example, Porter’s Five Forces might make for a good checklist when assessing a market, but you will still be better placed using a priority-driven structure to then solve the case.

Keep it under your hat...

One thing to bear in mind, though, is that, if you do use something gleaned from a framework in your interview, do not signal this to your interviewer. It's okay to use Porter’s Five Forces mentioned above, but you mustn't say, "I will now use Porter’s Five Forces...". Mentioning any of these kinds of frameworks will immediately ring alarm bells for the interviewer. They are there to assess you, not Mr. Cheng, Cosentino, or whomever else, and are not looking for candidates who succeed by rote learning!

Benefits without the costs - Building Blocks

At MyConsultingCoach, we fully appreciate the utility which can be derived from this practice of looking at frameworks as examples to be drawn on in a more flexible manner. This is why we teach a set of "building blocks" - general forms of business problems that tend to come up again and again.

True to their name, these building blocks can then be used in a modular fashion as component parts of customized priority-driven structures. You will find that certain parts of structures do tend to recur between different cases and it makes sense to maintain a repertoire of these.

In short, our building blocks give you all the advantages of frameworks (and more, as building blocks are more flexible...) without the drawback of being saddled with a dysfunctional, framework-based case system.

6. Takeaway - problems, trees, and frameworks

This article has given us a good idea of how problem-driven structures apply to cases, as opposed to conventional "framework" approaches. We have seen that numerous advantages can be had by making the effort required to learn how to devise problem-driven structures and draw issue trees.

It was not practical to give a full guide to actually drawing up problem-driven structures within a relatively short, standalone article. Mainly, this is because being able to devise problem-driven structures requires understanding several other concepts that are themselves non-trivial. To give a truly systematic account would thus have required repeating much of the content of our articles on segmentation and the MECE rule, besides others. This article would have started to resemble a small book and you, the reader, would not have had the patience to make it to the end.

It makes the most sense to learn how to build problem-driven structures in a more piecemeal, methodical progression. This is what our MCC Academy does. There, before learning how to draw up an issue tree and use problem-driven structures, you first receive a firm grounding in finance basics and those essential concepts like segmentation and the MECE rule. The problem-driven structure video from MCC academy is included at the start of this article, but you should ideally take the course as a whole to master case cracking.

Once you have learned how to build a priority-driven structure, it is time to use it to generate solutions to the client's problems. This next step is called "leading the analysis" - see you there!