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Case study handbook, how to solve cases

1. Recognizing the main issue in a case that needs solving "— Most cases illustrate one of three core scenarios The need to make a critical decision and potentially persuade other characters in the case to accept it The need to perform an in-depth evaluation that lays out the pros and cons or strengths and weaknesses of the subject of the case The need to perform a comprehensive problem diagnosis that identifies the root causes of a problem described in the case" "One of the best ways to identify the core scenario of a case is to ask yourself what the main character has to do? Another test is to ask what the major uncertainty in the case is?" "A case with an evaluation core scenario portrays a situation in which a deeper understanding of a person, division, company, country, strategy, or policy is necessary before any critical decisions or actions can be taken — Let’s use the two tests mentioned in the previous section about decision scenarios. The first is, What does the main character have to do? When the main character has to make a judgment about the worth, value, performance, effectiveness, outcome, or consequences of something, the core scenario is an evaluation. — What the major uncertainty in the case is? To determine the answers to these questions, the leaders must evaluate the current strategy." You can also ask, What is the major uncertainty of the case? The answer is the impact on Argentina. The president’s refusal to pay the country’s debts has to be evaluated to find out whether it will help or hinder the country—or both. The last possibility—that both could be true—is a characteristic of evaluations. They almost always yield both positive and negative findings. In the real world, the subject of an assessment is rarely perfectly good or perfectly bad.

Case Reading Process 1. Read the first and last sections of the case. What do they tell you about the core scenario of the case? These sections typically give you the clues needed to identify the core scenario.

2. Take a quick look at the other sections and the exhibits to determine what information the case contains. The purpose is to learn what information is in the case and where. Avoid reading sections slowly and trying to memorize the content.

3. Stop! Now is the time to think rather than read. What is the core scenario of the case? What does the main character have to do? What is the major uncertainty? Identify the core scenario by asking the two questions. Once you are reasonably certain of the core scenario—decision, evaluation, or problem diagnosis—you can use the relevant framework to ask the questions in the next step. Those questions will give you a specific agenda for productively exploring the case.

4. What do you need to know to accomplish what the main character has to do or to resolve the major uncertainty? List the things you need to know about the situation. Don’t worry about being wrong. This is probably the most important step of the entire process. If you don’t know what you’re looking for in the case, you won’t find it. The right core scenario framework will prompt you to list things that you need to explore. For example, for a decision scenario case, you should think about the best criteria the main character can use to make the decision. To determine criteria, think about quantitative and qualitative tools you’ve learned that can help you. 5. Go through the case, skim sections, and mark places or takes notes about where you find information that corresponds to the list of things you need to know. 6. You’re ready for a deep dive into the case. Carefully read and analyze the information you’ve identified that is relevant to the things you need to know. As you proceed in your analysis, ask, How does what I’m learning help me understand the main issue? The most efficient and least confusing way to read and analyze is to peel the onion—to study one issue at a time. For instance, let’s say that a decision has financial and marketing criteria. Analyzing the financial issues separately from marketing is far less confusing than trying to switch back and forth. As your analysis moves from issue to issue, you may discover gaps in your knowledge and have to add items to your list of what you need to know.

7. Your ultimate goal is to arrive at a position or conclusion about the case’s main issue, backed by evidence from the case. Remember, there are usually no objectively right answers to a case. The best answer is the one with the strongest evidence backing it. As you learn more, ask, How does what I know help me understand the main issue? When you are preparing a case for class discussion, consider alternative positions. Finally, take some time to think about actions that support your position. 8. What actions does your position support or require? In the real world, analysis is often followed by action. A decision obviously has to be implemented. Usually the entire point of a problem diagnosis is to target action that will solve the problem. And even evaluation has an important action component: sustaining the strengths and shoring up the weaknesses that it has revealed." "When you analyze a case, what do you actually do? “Analysis” is a word with multiple meanings. In case study, analysis is the close examination of the pieces of information in the case that you think may illuminate the main issue. The case reading process and the identification of a case’s core scenario provide the initial purpose for your analysis. The purpose will shift as you go deeper into a case. Here’s an example:

Purpose: Determine the core scenario: it’s a decision. Purpose: Find the decision options. Purpose: List criteria that might be useful in making the decision. Purpose: Find evidence having to do with your criteria. Purpose: Analyze the evidence related to the criteria. Purpose: Determine the decision option that is most strongly supported by the evidence.

Think of a research project again. As you proceed, your focus becomes narrower, but—and this is important—you don’t lose sight of the project’s goal. The goal of case analysis is to investigate the pieces of the puzzle and arrange them into a picture of the main issue that makes sense to you. The outcome of analysis is information, inferences, and calculations sufficient to allow you to take a position on the main issue. Analysis should be methodical and focused. Hit-or-miss analysis will be too scattered to advance your understanding." What Juan needs to know to make the decision? "Evidence is information that supports a position on the main issue. The main issue is defined by the case’s core scenario: a decision, an evaluation, or a problem diagnosis. When you express a position about a decision, evidence is the information you offer to justify the decision. The same is true of evaluations and problem diagnoses.

Case evidence consists of facts, including numbers; calculations based on factual numbers and reasonable assumptions; inferences from facts; and statements by characters in the case. Evidence has a characteristic that’s crucial to the credibility of a position or conclusion you advocate: it can be independently verified." What do I need to know to accomplish what the main character has to do or to resolve the major uncertainty?

"The analysis of a decision scenario has six distinct elements:

1. Identification of the required decision Somewhere in the case, usually in the first section, you’ll find a statement of the decision that is needed. 2. Review or identification of options Decisions usually have options. As soon as you know the case is about a decision, look for the options. They might be binary—yes or no—or there might be several competing possibilities and you need to know—or define—what they are before you can analyze the case.Here’s a suggestion for working on a case that has more than two options. You can’t juggle three (or more) options in your mind. If you try, you’ll become confused. Instead, first work on the two options that seem most different from each other. Then work on the remaining options. You should have an understanding of all the available options before you make your final decision.You may encounter decision scenarios in which the options aren’t clearly defined. In these situations, you’ll need to define the most logical options before beginning your analysis. Once you define them, you can analyze which one is best. 3. Criteria selection When studying cases, criteria are the answer to the following question: What should I think about when making the decision? The criteria you use are the most important part of analyzing a decision scenario. When you don’t have any criteria in mind, you will roam around the case looking for something solid to hold onto. Irrelevant criteria will lead to wasted time and leave you vulnerable to recommending a decision with little to no supporting evidence. Decision criteria should be: - Relevant to the decision. They should reflect concepts that can help you understand a specific decision. A case about a leader calls for criteria relevant to leadership, not accounting or marketing. - Relevant to the case evidence. There are many possible criteria for a given decision, but you need to look for those that reflect the evidence in the case. Early in your study of a case, you’ll need to make some educated guesses about the criteria. (See the analysis of the case in the second part of this chapter for more explanation of this.) Technical concepts and metrics appropriate to the decision can assist you in picking criteria.For example, take a case that revolves around an accounting decision. You would want to consider which of the accounting concepts you’ve learned could serve as possible criteria. - Limited to the minimum necessary for making a sound decision. A decision recommendation is difficult when many criteria are used. You are forced to work with and reconcile the findings generated by many factors. Your task will be to identify the top criteria—that is, those that are most helpful in revealing what you need to know for making the decision. 4. Criteria-based analysis The analysis of a decision directed by criteria examines the case evidence related to each criterion and what it says about the available options. Your goal is to learn which option offers the best fit between the criteria and the evidence in the case. 5. Recommended decision Once you have findings on all of your criteria, take a step back and see what decision recommendation they seem to support most strongly. Findings on different criteria often conflict with each other, requiring you to make a judgment of which criteria and what evidence are most important for making the decision. 6. Proposed actions A decision is only as good as its implementation. A smart decision can be undermined by poor implementation. For that reason, take action planning seriously. It’s a skill every bit as important as decision making. The purpose of a decision action plan is to implement the decision as effectively as possible."

"Evaluations have the same practical purpose: to give people information that can help them improve something or that assists them in making a choice or a recommendation. Evaluations are sometimes a prelude to a decision." "The analysis of a case evaluation scenario has six elements:

1. Identification of the subject An evaluation isn’t possible without a clearly defined subject. The subjects of evaluation scenarios can be anything from an individual, team, product, and company performance to the effectiveness of a company strategy or a nation’s economic policy. The desired understanding or knowledge to be gained from an evaluation is often the worth, value, performance, effectiveness, outcome, consequences, or risks of the subject. 2. Criteria selection Criteria are the answer to the question: What should I think about when I make the evaluation described in the case? In other words, What criteria should I use to make the evaluation? You choose criteria that are relevant to the subject of the evaluation. Evaluation has an important requirement: it always needs to consider the positives and negatives of the subject. Virtually all evaluations are going to reveal both, because, in the real world, perfection is rare. Your analysis needs to follow the criteria wherever they lead. Case-based evaluation encourages two habits of thinking that are invaluable to business school students (and to students in many other fields): - It enforces analytical honesty—that is, you follow the analysis where it takes you without a preconceived idea of what the ultimate outcome should be. - It requires your evaluation to be firmly grounded in evidence instead of relying on opinion or conventional wisdom. By evidence, we mean information derived from the particulars of the case—its facts, exhibits, numbers, calculations based on the numbers, charts, dialogues, and narratives, rather than from general knowledge, your personal work experience, or material from outside sources such as the web. 3. Criteria-based analysis The evaluation of a subject, directed by criteria, looks at the case evidence related to each criterion and considers whether it provides positives, negatives, or both about the subject. Your goal is to determine the positive or negative “best fit” between the criteria and the evidence. Each of those judgments contributes to the overall evaluation of the subject. 4. Overall evaluation The goal of your criteria-based analysis is an evaluation that takes into account what you have learned from applying your criteria to the subject. Your position should reflect both the positive and negative findings. You can’t determine your overall evaluation based on whether there are more positives than negatives or vice versa. You have to make a judgment about the relative importance of the criteria and the findings based on them. 5. Identification of contingencies Sometimes an evaluation requires acknowledgment of a contingency that could have a significant impact on the overall evaluation. For example, favorable assessment of a business proposal could be subject to the following contingency: To fully realize their promising business model, the founders will have to raise more money. They can’t build out their platform without a larger investment. You should only be concerned with a major contingency, one that could have a significant impact on your position. A contingency isn’t required for an evaluation. And it shouldn’t be used as a hedge or evasion. It should call out a legitimate possibility but not stop you from taking a definitive position. 6. Recommended actions The purpose of an action plan is to improve the subject of the evaluation. Following your analysis and formulation of an overall evaluation, you should give some thought to actions."

"But sometimes a case may not provide a strong signal directing you to the concepts or frameworks with the greatest explanatory power. What do you do then? The best advice is to do what doctors do: they compile evidence and look for patterns that suggest possible causes and, in turn, analytical tools to investigate these causes further. The case used in this chapter to demonstrate problem diagnosis requires this kind of approach The complex problems featured in cases usually have multiple causes. But many causes result in a diagnosis that’s hard to grasp and act on. If you find that you have a list of, say, ten causes, consider whether some of them can be included under a broader cause. For example, let’s say you have several causes related to teams. You could combine them under a broader cause, team performance or team effectiveness."

"A case essay can be organized to answer three simple questions: What? Why? How?

1. What? Your position statement that responds to the question. A sharply focused position statement at the beginning of an essay answers the reader’s first question: What is your answer? Without one, the essay has no purpose or direction as far as the reader is concerned. One of the most common failings of case exams is that writers don’t offer the reader a clear-cut position statement. A variant is to say that there are a number of possible positions but not commit to any. 2. Why? Your argument that supports your position statement. An argument consists of a conclusion or position statement, criteria or causes, and evidence. 3. How? Your action plan detailing what needs to be done based on your position statement and argument. An action plan has four elements: - It states specific goals. The goals of an action plan briefly describe the desired result or end state of the plan. In other words, what will the situation look like when the action plan has been implemented? The general purpose of an action plan is to improve the situation that is the subject of the argument. - It translates the key points of the argument into action. Your argument lays out your position and the evidence supporting it. Your action plan goals describe a desired end state. Your action plan is the bridge between the two. It answers the question, How do you get from what you have argued to the situation you envision in your goals? What needs to be accomplished to truly achieve that state? - It consists of a series of specific action steps. An action plan consists of specific steps to meet the goals of the plan and incorporate the actionable content of the argument. - It puts the action steps in chronological order. An action plan is not just a collection of steps; it’s a set of steps meant to be executed in a specific order in time. Urgent steps come first, less urgent ones come later, and some come much later. Professors are interested in how you prioritize steps in the timeline of the plan. Action plans are easier to understand when they’re divided into short term and long term: — Short-term steps are urgent, easy, or necessary for longer-term steps. — Long-term steps are hard to achieve, complex, time consuming to complete, or dependent on prior steps."

"HOW TO ORGANIZE A DECISION SCENARIO ESSAY Essays about decision scenarios have five elements. They: 1. State the decision that needs to be made and any options. 2. Recommend a decision option (i.e., present a position statement). Professors want to learn what course of action would you recommend (one particular course of action based on your analysis). 3. State the decision criteria. On what basis are you recommending the decision? Cases don’t state decision criteria. You have to infer them from case content, your experience, and appropriate concepts, frameworks (e.g., principles of good leadership), and formulas (e.g., net present value) you have learned. - First, the number of criteria should be limited to only those that are critical to make the decision. - Second, effective criteria tend to be broad rather than narrow. The more general the criteria, the more inclusive they are—up to a point. Criteria that are too abstract will yield very little useful information about the decision. The trick is to hit the right level of abstraction. 4. Prove the recommended decision. 5. Present an action plan. (short, mid, long term) What actions are essential to implement the decision? – What urgent actions must be taken? – What other short-term actions are necessary, but not urgent? – What are the long-term steps? Who should be involved in the implementation? (And, possibly, who should not be involved?) What groups, teams, or departments are necessary for successful implementation? – What are their roles in the implementation? – What groups, teams, or departments could oppose or undercut implementation? What actions can soften or eliminate their opposition? What things could go wrong with the implementation? What actions could avoid or mitigate these problems?"

"HOW TO ORGANIZE AN EVALUATION SCENARIO ESSAY Essays about evaluation scenarios have five elements. They:

1. State your overall evaluation (i.e., present a position statement). 2. State the evaluation criteria. 3. Prove the overall evaluation. 4. Explain and respond to any major contingencies. 5. Present an action plan. Which of your findings can benefit most from action? – What urgent actions will result in the greatest benefit? – What other short-term actions are necessary but not urgent? – What long-term steps will result in the most benefit? Who should be involved in the action steps? (And, possibly, who should not be involved?) What things could go wrong with the action plan? What actions could avoid or mitigate these problems?"

"HOW TO ORGANIZE A PROBLEM-DIAGNOSIS SCENARIO ESSAY Essays about problem-diagnosis scenarios have four elements. They: 1. Define the problem. 2. Summarize the causes of the problem. 3. Prove each cause. 4. Present an action plan. How can the major causes of the problem be fixed or, when the problem is positive, be supported and sustained? – What urgent actions will have the greatest impact on the problem? – What other short-term actions are necessary but not as urgent? – What long-term steps will result in the most impact on the problem? Who should be involved in the action steps? (And, possibly, who should not be involved?) What could go wrong with the action plan? What actions could avoid or mitigate these problems?"

"STUDY GUIDE FOR DECISION SCENARIO CASES I. Analyzing a Decision Scenario Case 1. To begin your work, think about the following questions: - What is the decision that needs to be made in the case? Example: Should Trendway make changes to its production line? - What are the major decision options? Example: The company can expand its current production line, improve its yield, or build a new line with advanced technology. 2. Exploring the Decision Options - What questions will help you decide which decision option is best? Example: Which option yields the best financial results for Trendway? - What concepts and frameworks might help answer your questions? Example: The concepts of unit cost and breakeven help to compare the financial impact of the three decision options."

Possible criterion 1: Facts/evidence

Possible criterion 2: Facts/evidence

"3. Ready to Recommend a Decision? Based on your analysis, recommend a decision option and then state the major reasons that support your recommendation. - The evidence you compiled above is critical to prove the decision you recommend. — What decision do you recommend? Example: Trendway should invest in a new production line. — What are the major reasons that support your recommendation? Example: The new line will make Trendway more competitive in the medium-to-long term. — What are the major risks of your recommended decision? Example: A major downturn in the market could greatly reduce or eliminate the financial benefit of the new line."

Recommended decision Summary of major reasons for recommended decision Evidence proving recommended decision Criterion 1 a. b. c. Criterion 2 Criterion 3 ... "4. Action Plan Identify the high-level goals for your action plan. In other words, how do you want the action plan to change the situation in the case? - Organize your action plan steps. — Short term — Long term - Major risks: Identify the most important one or two risks associated with your action plan. - Mitigation of risks: How would you eliminate or reduce the risks?"

"STUDY GUIDE FOR EVALUATION SCENARIO CASES I. Analyzing Evaluation Scenarios” - What is the subject of the evaluation? (It can be a person, team, product or service, company, country, strategy, or policy.) Example: An ongoing marketing plan. - What is the evaluation you need to perform? (It can be determining the worth, value, performance, effectiveness, outcome, or consequences of the subject.) Example: Is the marketing plan meeting the goals set for it? 2. Exploring the Evaluation — What questions will help you make the evaluation? Example: Is the marketing plan performing as expected, exceeding its goals, or underperforming? — What concepts and frameworks might help answer your questions? Examples: The 5Cs and 4Ps of marketing can help evaluate the strategic value and tactical performance of the marketing plan" Use the following grid to organize your thinking about the evaluation. Use your questions to study the evidence and identify criteria for making the evaluation. Write down the criteria, the case evidence relevant to them, and what overall evaluation the evidence supports. Your goal is to determine which overall evaluation is most strongly supported by the evidence. You can defer thinking about action steps if you’d rather focus on the evaluation first. Possible criterion 1: Facts/evidence

Possible criterion 2: Facts/evidence

"3. Ready to Recommend an Overall Evaluation? Based on your analysis above, what is your overall evaluation of the subject? Example: The marketing plan has had several positive effects, but it has had little impact on customers’ impression of the brand. What are the major reasons that support your overall evaluation? Example of a reason: Survey results indicate little change in customers’ favorable impression of the brand."

Overall evaluation Summary of major reasons for recommended evaluation Evidence proving recommended evaluation Criterion 1 a. b. c. Criterion 2 Criterion 3 ...

"4. Action Plan Identify the high-level goals for your action plan. In other words, how do you want the action plan to change the situation in the case? - Organize your action plan steps. — Short term — Long term - Major risks: Identify the most important one or two risks associated with your action plan. - Mitigation of risks: How would you eliminate or reduce the risks?"

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