1、McKiney On line case study To step through this case example, we will give you some information, ask a question, and then, when you are ready, give you a sample answer. We hope that the exercise will give you a sense of the flow of a case interview. (Please note, you can stop this exercise and pick
2、up where you left off later. Your cookies must be on to use this feature). In this exercise, you will answer a series of questions as the case unfolds. We provide our recommended answers after each question, with which you can compare your own answers. We want to emphasize that most questions in a c
3、ase study do not have a single right answer. In a live case interview, we are more interested in your explanation of how you arrived at your answer, not just the answer itself. An interviewer can always assess different but equally valid ways of approaching an issue, and then bring you back to the p
4、articular line of inquiry that he or she wants to pursue. You should also keep in mind that in a live case, there will be far more interaction with the interviewer than this exercise allows. For example, you will have the opportunity to ask clarifying questions. Finally, a live case interview would
5、typically be completed in 30 - 45 minutes, depending on how the case evolves. In this on-line exercise, there is no time limit. There are eight questions in this on-line case study. This case study is designed to roughly simulate one during your interview, so you will not be able to skip ahead to th
6、e next question until you have answered the one you are on. You can refresh your memory of previous answers by clicking the highlighted Q&A links to the left. To print the answer, click on the print icon that appears in the TOP RIGHT corner. At the end, you can print the entire on-line case study at
7、 once. The case Question 1 Client Goal: Double the number of recruits while maintaining their quality with minimal increase in resources expended Our client recruits graduating college seniors for entry-level positions in locations around the world. It currently hires and places 500 graduates per ye
8、ar but would like to triple in size over the next ten years while maintaining quality. Assume that the increase must all come from hiring graduating seniors. (In an actual case, you may not be given this and other assumptions unless you ask.) The clients current recruiting budget is $2 million annua
9、lly, and while it is in a strong financial position, it would like to spend as few additional resources as possible on recruiting. McKinsey is advising the client on what steps it will need to take in order to meet its growth targets, while staying within its budget constraints. Q1: What levers does
10、 the organization have at its disposal to achieve its growth goal? A: Some possible levers are given below. Its terrific if you identified several of these and perhaps some others. Attract more applicants at the same cost Review the list of campuses targeted (e.g., optimize resource allocation acros
11、s schools). The review may result in adding certain higher potential campuses and eliminating other ones that appear to have more limited potential. Review recruiting approach at each campus (e.g., optimize cost-effectiveness of messages and approaches at each school). Extend offers to a higher perc
12、entage of applicants while maintaining quality (e.g., reduce the number of people who are turned down who would have performed equally well in the job) Improve acceptance rates among offerees (e.g., better communicate the benefits of the job relative to alternatives or improve the attractiveness of
13、the job relative to alternatives) Question 2 For the remainder of the discussion wed like to focus on the two specific levers involving attracting more applicants at the same cost. Review the list of campuses targeted (e.g., optimize resource allocation across schools). The review may result in addi
14、ng certain higher potential campuses and eliminating other ones that appear to have more limited potential. Review recruiting approach at each campus (e.g., optimize cost-effectiveness of messages and approaches at each school). Please note that if you identified different but equally valid levers,
15、the interviewer would be able to assess them. But for the purpose of this case study, we are going to focus on these two levers. Q2: How would you initially approach determining whether the client can increase hiring by adjusting the list of campuses targeted? What sort of analysis would you want to
16、 conduct and why? A: You might take the following approach, where weve outlined two avenues of analysis: Estimate the hiring potential across schools Analyze the number of hires by school over the last several years Develop a comprehensive list of schools that meet our requirements and a minimum set
17、 of standards for recruits Survey seniors at these schools to determine interest in an entry-level position with the client Consider the size of the graduating class at each school, determine how that class might be segmented (e.g., each class could be segmented by discipline or segmented based on c
18、areer interests in response to the survey), then calculate the size of each segment Estimate the optimal cost-per-hire across schools Compare the current cost-per hire across schools Identify opportunities to decrease the cost-per-hire at each school Helpful Tip You may have a slightly different lis
19、t. Whatever your approach, we love to see candidates come at a problem in more than one way, but still address the issue as directly and practically as possible. In giving the answer, its useful if you are clear about how the results of the analysis would help to answer the original question posed.
20、Question 3 Twenty-five percent of the annual recruiting budget is spent on candidates (i.e., attracting, assessing, and getting them to accept). Twenty percent of hires are categorized as “most expensive“ and have an average cost-per-hire of $2,000. Q3: What is the average cost-per-hire of all other
21、 candidates? Remember that the client hires 500 students per year and its annual recruiting budget is $2 million (information that we hope you noted earlier). A: The answer is $750 per hire (or less than half the cost-per-hire of the “most expensive“ candidates). Amount spent on the less expensive c
22、andidates: 25% of $2 million budget = $500,000 spent on candidates 20% of 500 student = 100 students categorized as “most expensive“ 100 x $2,000 cost-per-hire = $200,000 spent on “most expensive“ hires $500,000 recruiting budget - $200,000 = $300,000 remaining for all other hires The number of less
23、 expensive candidates: 500 hires - 100 = 400 “other hires“ Cost-per-hire of the less expensive candidates: $300,000/400 =$750 per hire Helpful Tip While you may find that doing a straightforward math problem in the context of an interview is a bit tougher, you can see that it is just a matter of bre
24、aking the problem down. We are looking for both your ability to set the analysis up properly and then to do the math in real time. Question4 Q: In order to decide whether to reduce costs at the least efficient schools (i.e., those with an average cost per hire of $2,000), what else would you want to
25、 know? A: Some of the possible answers are given below. Basic questions: What are the components of costs at these schools (why is it so expensive to recruit there)? What opportunities exist to reduce costs? How much cost savings would result from implementing each of the opportunities? What consequ
26、ences would implementing each of these opportunities have on recruiting at the least efficient schools? Questions demonstrating further insight: Why is the cost lower at more efficient schools, and are there best practices in resource management that can be applied to the least efficient schools? If
27、 we reduce costs at the least efficient schools, what will we do with the cost savings (i.e., what would be the benefit of spending the money elsewhere vs. where it is currently being spent)? Helpful Tip We would not expect anyone to come up with all of these answers, but we hope some of your answer
28、s head in the same direction as ours. Yours may bring some additional insights. In either case, be sure that you can clearly explain how your question will bring you closer to the right decision. Question 5 The McKinsey team conducts some analysis that indicates that increasing spending on blanket a
29、dvertising (e.g., advertisements/flyers on campus) does not yield any significant increase in hires. Q5: Given that increased blanket advertising spending seems to be relatively ineffective, and the client doesnt want to increase overall costs, what might be some other ideas for increasing the candi
30、date pool on a specific campus? A: We are looking for at least a couple of answers like the ones given below: Improve/enhance recruiting messages (e.g., understand target candidate group, refocus message on this group, understand competitive dynamic on campus) Utilize referrals (e.g., faculty, alumn
31、i) Come up with creative ways to target specific departments/clubs of the school Rethink advertising spending - while increasing blanket ad spending doesnt seem to work, advertising might still be the most efficient and effective way to increase the number of candidates if it is deployed in a more s
32、ystematic, targeted way Helpful Tip This question is a good one for demonstrating creativity because theres a long list of possible ideas. Additional insights into how a given idea would be approached and how much it would cost are helpful. Question 6 For simplicitys sake, lets say weve conducted ma
33、rket research and found that there are two types of people on each campus, A and B. Historically, our client has also used two types of recruiting messages in its advertising. The first, called “See the World,“ gets one percent of type A students to apply, but three percent of type B students. The s
34、econd, called “Pathway to Leadership,“ gets five percent of Type A students to apply, but only two percent of type B students. The chart below lists the breakdown of types A and B students at some of our major campuses, and the message our client is using on campus. School % of Type A Students % of
35、Type B Students Recruiting Message Used on Campus University 1 80% 20% Pathway to Leadership University 2 48% 52% See the World University 3 70% 30% Pathway to Leadership University 4 60% 40% See the World Q6: Assuming theres no difference between the costs of each message, what can you tell me from
36、 this information? School % of Type A Students % of Type B Students Recruiting Message Used on Campus University 1 80% 20% Pathway to Leadership University 2 48% 52% See the World University 3 70% 30% Pathway to Leadership University 4 60% 40% See the World A: According to these numbers, the client
37、should use the “Pathway to Leadership“ message across all four universities. The “See the World“ message is preferable only if more than 80% of the students at a given university are of type B. Helpful Tip An even more insightful response would mention that the ultimate answer depends on the cost of
38、 each message, whether the cost increases depending on the number of students at the campus, and how interested we are in students of Type A vs. Type B (e.g., will one type be more likely than the other to get an offer and to be successful on the job). One could imagine using both messages on some c
39、ampuses if the additional cost were justified by the resulting increase in hires. Question7 University 4 graduates 1,000 seniors each year. Q7: How many new candidates might be generated by changing the recruiting message at University 4 to Pathway to Leadership? A: The answer is 20 candidates (i.e.
40、, an increase of over 100%). Number of each type of student at University 4: 1,000 seniors x 60% = 600 Type A students 1,000 seniors x 40% = 400 Type B students Candidates attracted be See the World message: (1% x 600) + (3% x 400) = 18 candidates Candidates attracted by Pathway to Leadership messag
41、e: (5% x 600) + (2% x 400) = 38 candidates Increase in candidates resulting from change in message: 38 - 18 = 20 more candidates (an increase of over 100%) Question8 Q8: What sort of next steps should we tell our client wed like to take based on what we have discussed today? A: The ability to come t
42、o a logical, defensible synthesis based on the information available at any point in an engagement is critical to the work we do. Even though wed consider ourselves to be very early in the overall project at this point in the case, we do want to be able to share our current perspective. The ideal an
43、swer would include the following points: FINDINGS There appears to be an opportunity to significantly increase total applicants of the same quality that we are getting today at the same or reduced cost: Increasing blanket advertising is ineffective and costly, but changing the advertising message on
44、 some campuses could increase applicants significantly without increasing costs. At one of the campuses weve looked at, University 4, the number of applicants would go up more than 100 percent The cost-per-hire varies dramatically from school to school. This suggests that there may be opportunities
45、to reduce costs in certain places or reallocate resources more efficiently NEXT STEPS We plan to explore further ideas for increasing quality applications by changing the mix of schools, beginning with a more detailed review of the opportunities to reduce costs at certain schools After looking at le
46、vers to increase total applicants, we will be analyzing opportunities to improve the offer rate (i.e., ensure were not turning down quality applicants) and to increase the acceptance rate We will examine additional methods for attracting more applications from our current campuses (e.g., referrals, clubs) in addition to assessing the impact of improved messaging on c
