Case Studies

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What is a case study?

A case study comprises of a general situation for which you will be asked to provide a possible solution. For example you can be given data regarding the past sales of the company and the changes that took place in the manufacturing line over the past 4 years and then the interviewer may give you the current market share situation. You can be asked for the reasons behind the current market patterns and what according to you should be the possible solution for the problem. This may look difficult for now but the situation can be handled very well with a bit of common sense; also remember that there are no right or wrong answers to a case analysis, all the interviewer is looking for is that how many possible outcomes/reasons you can deduce with the given data.

Case study based interviews can be classified in 3 sub categories:

1. Pure case interviews as described in example above.

2. Puzzles

3. Guesstimates.

You should not worry much about case interviews because at graduate level (especially engineering), the interviewers refrain from hardcore case interviews and limit themselves to guesstimates and puzzles.

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 Examples of a case study :

• Example 1

You want to start a luxury car taxi business in Mumbai. You have to decide the following:
1. Which cars should be bought and the number of cars to be bought.
2. What charging pattern should be followed?

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• Example 2

Surender is the founder of a company ABC Pvt. Ltd.  He started this venture in the year 1999 with an initial capital of Rs. 50 lakhs.  In its first year of operation, the company had a gross turnover of Rs. 90 lakhs and a net loss of Rs. 75 lakhs.  The company had amazing growth in the next six years of business.  In the year 2005 it recorded a turnover of Rs. 50 crores and had a profit of Rs. 5 crores.  The company had been successful in obtaining prestigious contracts which have to be executed in the coming 18 months.
Surender was recollecting his achievements over the last six years as he walked into his office on the 2nd of April 2005.  As soon as he entered into his cabin he saw resignation letters of three of his key staff members – Prakash, the Marketing Manager along with Sudhir and sankalp, the senior most Project Managers of the company. Prakash had been instrumental in securing the larger orders for the company in the last year. His loss would be hard to fill as he was very popular among the entire marketing team and his exit could lead to further resignations from the marketing department.  Sudhir and sankalp were the key people in the project execution department and were handling projects of extremely prestigious clients over the last six years.  Their sudden exit would seriously hamper the execution of the large orders which the company had recently got.
In a sombre mood Surender was thinking what he should do next.  He decided to speak to Prakash, Sudhir and sankalpseparately. After an initial round of discussion with all of them he found out that they were all made offers from BCD Private Ltd., a major competitor of ABC Private Ltd.  BCD Private Ltd., had not only offered them a 50% hike in salary, but also offered them better designations.  A few months ago, another senior Project Manager, Seema had left ABC and joined BCD.  It was Seema who was behind the current situation.
Surender was perplexed and was trying to determine what should be his next step.  The company now had over 100 employees and if adhoc increases of salary were made it would lead to discontent among other employees.  The company had a policy of reviewing salaries on the first of January every year.  The next salary review was more than seven months away.  If he allowed the three gentlemen to leave there could be a further exodus of good employees from ABC.
Can you help Surender resolve this dilemma?

Possible solution for this example:

Gist of the problem-
Three key employees of ABC Pvt. Ltd., a software development company, have submitted their resignations to Mr. Surender (the founder and head of the company). These three are very senior managers in the company and have been responsible for  procuring and execution of prestigious projects, on which the company is currently working on. If they leave the company then it may adversely affect the execution of current projects and profitability of company in the future.

Information provided-

1. Mr. Prakash, Mr. Sudhir and Mr. Sankalp, three key employees of ABC Pvt. Ltd., have expressed their desire to leave the company.
2. These three persons have held a key role in bagging and execution of orders for the company in the past.
3. They have been made a job offer by BCD Pvt. Ltd., a competitor in the market, with 40% more salary and better positions.
4. The person responsible for making these offers is an ex-employee of ABC Pvt. Ltd.
5. If the salary of Mr. Prakash, Mr. Sudhir and Mr. Sankalp is increased in the middle of the financial year then it may lead to discontent among other workers.
6. If Mr. Prakash, Mr. Sudhir and Mr. Sankalp are allowed to leave the company then it will adversely affect the execution of current contracts and may also encourage other employees to leave.

Suggested Course of Action (Immediate)-

1. Mr. Surender should have another round of talks with Mr. Prakash, Mr. Sudhir and Mr. Sankalp and talk to them about their importance in the corporation and try to pacify them on moral grounds.
2. Mr. Surender can pacify these three managers by offering them better positions in the company Will it not create problems for others at similar levels? .
3. If they they are not satisfied with only a promotion, then Mr. Prakash should try and make them understand the implications on the morale of other workers if they are offered a salary hike in the middle of the year and should instead offer them moderate bonus for the time and promise them a revision in salary next January.
4. He can also offer them indirect benefits like travel allowances, HRA etc.
5. If the above course of action gives positive results then he should try and make them sign a contract that binds them to stay with the company until the current contracts, for which they are responsible, are completed.
6. Think of the possible solution in case they don’t agree to anything and see how he can mange without them.

Future Course of Action-

• In the current situation, the position of ABC Pvt. Ltd. Was compromised because it seems to be completely dependent on a small group of managers for a major part of its work. As a result one or two key employees have a critical role in the success or failure of the company. Hence, in order to avoid any such jeopardizing situation in the future, Mr. Surender should try and hire more managers so that the hierarchy of management positions is not limited to a few persons.
• The company should try and create a more positive work environment and work culture so that employees prefer to work in the environment of the company even if a competitor offers somewhat higher wages.

Conclusion-

This situation should be taken as a lesson by Mr. Surender and he should try to reduce the dependence of the company on a small number of managers. It should also be taken as an opportunity to create a more attractive and more positive working environment in the company which supersedes the monetary gains provided by working with any competing company.

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Example 3

You are a private finance company, which is facing stiff competition (in terms of attracting new customers) from the new entrants in the market. To stand up to the competition the management has decided to do away with loan processing fee for the new customers. Write a case analysis giving your views on the decision, its implications and any other actions that should be taken.