The Mutually Exclusive, Collectively Exhaustive (MECE) framework is an important problem structuring principle that consultants use to organize data efficiently and comprehensively. In this article, we will cover how to utilize MECE in a case interview setting.
To watch a video of MECE being used in a case interview example, watch this case structure walkthrough video.
MECE in a Market Entry Case Interview
Imagine you’re sitting across from a consultant during an interview. She says to you, “Our client is ABC Tech Corp and they currently have three major revenue segments – smartphones, computers, and tablets. They are now looking into entering the TV market but want your help understanding which geographical market to enter into first. What would you recommend?”
If you’ve never heard of consulting case interviews, this kind of question might seem overwhelming, or even almost impossible to solve at first. However, let’s see how we can use the Mutually Exclusive Collectively Exhaustive (MECE) framework to find the relevant data needed to answer this question.
Building a MECE Framework: Case Interview Example
ABC Tech Corp is looking for advice on the right geographical market to enter with new TV products. Therefore, the following MECE categories could be one way to tackle the case:
- North America
- South America
- Rest of World
Breaking down the market into these geographies is clearly MECE – mutually exclusive given that there are no overlaps between any category, and collectively exhaustive because they covers all possible areas of the world.
For each of these geographical categories, you might ask for data for the following areas:
- Size of TV market
- Historical and future growth of TV market
- Profit margins
- Key competitors
- Customer segmentation
From here on out, you would continue to assess the data provided by your interviewer for each sub-category (size of market, historical and future growth, profit margins, key competitors, customer segmentation, and products). This MECE framework ensures that the data you uncover for each sub-category can be compared across the different geographies, helping you ultimately pinpoint the right geography for ABC Tech Corp to enter.
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Example of a non-MECE Framework
Using the same case example with ABC Tech Corp, let’s imagine you want to study the overall market and so you structure your framework into the following categories:
- Competition – Who are the major TV players and how intense is the competition?
- Market size – How big is the TV market and at what rate is it growing?
- Customers – Who are the major TV consumers and what kind of products do they buy today?
- Profitability – What do profit margins look like in the TV market and have they been increasing or decreasing?
- Regulation – Are there any barriers to entry in the TV market?
As you may presume from looking at this framework, there is a way to ask questions that limit the overlap between each category. However, you could ask questions that cause the categories to not be Mutually Exclusive, such as asking what the profitability profile is like for each major competitor in the market or the market size of each customer segment.
Additionally, you could fall into a trap of not being Collectively Exhaustive with this framework. For instance, you may ask for data about the size of the market and find that the largest opportunities based on the current players are in North America, Asia, and Europe. If you only end up focusing on those markets, you may fail to study the other geographical markets. It may be that ABC Tech Corp happens to have a strong presence in Australia and entering that market turns out to be the most profitable.
MECE case framework example is great for understanding how to be MECE during your case interview. You must be able to structure your case in a way that demonstrates to your interviewer than you understand how to be mutual exclusive and collectively exhaustive. If not, it’s unlikely that you’ll get a consulting offer. Listen to Jenny Rae as she expertly lays out an example of how to structure your case interview in a MECE manner.
MECE Case Framework Example YouTube Transcription
This is something that we are often asked about in our case interview workshops, that we do on campuses at over sixty campuses around the world. And this is something that I think would be really helpful for you to understand. So I’ve prepared a prompt as well as an example, of two kinds of structures. A MECE case framework example that is MECE, and one that is not. Just to give you an idea of what it means to have a MECE case structure.
The Case Prompt
The prompt is just a basic business story. It’s a colleague of mine and a friend who now has launched, what is the fastest growing organic deodorant in the country. It’s made largely from charcoal, and you have to apply it in a stick format. And they just recently were adopted at Target as one of their entrant points for retail. So this is a really exciting growth plan for them. Right now they’re in the United States and they’re doing about twenty million dollars in revenue. But they’re interested in international expansion. And our goal is to help them think about that as the consulting firm. So you’re gonna get this in a case, just as an aside, this is a pretty clear market entry case. And the structure that we’re gonna use just to demonstrate what a MECE structure looks like, it’s not the only structure that you could use to solve it.
The Business Case Summary
But the fundamentals are:
- this is a pretty small business
- at twenty million in revenue
- they have a consumer product
- it’s a new product in a niche segment
- and they’re interested in not market expansion in their current market
- but actually overseas market expansion which is a market entry framework.
We’re going use for this one the market study framework from Management Consulted. And that has five standard pieces to it that you can use or not use as you’re thinking about it.
5 Key Areas
So the first one, a non MECE framework, I’m just gonna talk through five of the key areas.
- The first one is the market.
- The second are competitors.
- The third are customers.
- The fourth is the company and its’ capabilities.
- And the fifth is the product.
In this case when we think about those five areas, there are some that could naturally overlap. And I’m going to demonstrate how you can make the mistake of letting them overlap.
Mistake Of Overlap
In market, for example, you could look at data that includes the fragmentation of the market. That’s a pretty clear overlap with a competitor segment. You could also look at the market share breakdown, inside the market. That’s also an overlap of the competitors segment. And you could look at market growth rates, which is not an overlap. When you go to the competitor segment, you could talk about how market share has changed over time. That’s a different data point but it’s still overlaps with what you talked about inside the market.
Relative Market Share
In addition, you could talk about relative market share. And even though we talked about fragmentation before, relative market share is going to use similar data. So again, that’s one key area where you could have some overlap. In addition for customers if you said the overall growth rate of customers using the product, that could be a little bit similar to what you looked at inside the market category. And we could keep going, but it’s not necessary to demonstrate that this is an issue.
Especially in these first three categories, when you’re thinking about market, and you’re talking about competitors, they’re thinking about customers. Fundamentally when you sum up all the customers in a market, then they add up to the market in total. And when you fundamentally sum up all the competitors that are selling in the market, not their total revenues, but the revenue in this segment, then you get the market. So these could be some naturally overlapping buckets. And you’re not going to be able to be MECE or mutually exclusive and collectively exhaustive by using them.
MECE Case Framework Example
So in contrast, if you wanted to solve this problem using a structure that was more MECE, you want to make sure that you don’t have any overlap in data. And the key way to do that is to think about the market as a whole, and then to think about just the competitor breakdown, and the customer breakdown.
What To Identify
So just to exemplify that, we want to identify the growth rate of markets outside of the US, that are top-ten markets. We want to identify the size in revenues of markets outside the US. And we want to identify regulatory concerns about entering new products in markets outside of the US. We want to be very specific that we were thinking only about the macro market, and not about customers, or about competitors in those markets.
Dominance Of Competitors
Secondarily we want to think about the dominance in the competitors bucket of certain areas. We want to think about market share by market, of key international global players. It’s likely by the way that this kind of product would be ripe for acquisition by a large multinational company, like Procter & Gamble. So we want to identify what their market share was in key markets. If one of their key market share areas was Germany, we might want to enter Germany first. And we want to be really specific that were thinking about the competitor bucket in terms of the future plan for the business.
We also might want to identify fragmentation of cross current markets. We might want to identify the growth rate of competitor products. We might want to identify three key features of competitor products, such as their price, their brand positioning, and their marketing strategy.
When we would go over to customers, we want to make sure that we weren’t thinking about the market as a whole, but we’re thinking about customer segments. Who are the three major customer segments that are buying these products. What are the age demographics of the customer segments. We really want to make sure that we identify what customer segments are being used, inside those areas. And you don’t want to roll it back up to the market.
Concluding Thoughts on being MECE in the Case Interview
Ensuring that your structures are Mutually Exclusive Collectively Exhaustive (MECE) will help you become a stronger case interviewee. However, keep in mind that your frameworks don’t always need to be 100% MECE for you to crack a case. Given that case interviews are so short, it may not be possible or even necessary to be fully MECE. If there are some overlaps between your categories that cause you to not be totally Mutually Exclusive, or if you focus on the crux of a case’s problem but don’t cover all potential bases, you can still pass the case interview.
Therefore, our rule of thumb is to be as MECE as possible, but if you must choose, focus on being Mutually Exclusive. More importantly, be sure you are properly addressing the business problem within the case via a focused and relevant framework.
So as you’re going through your interview process, make sure in a situation like this or any others that you come across, that you’re being MECE. That you’re not overlapping any of your categories. You don’t have to worry as much in cases about being the “C”, the collectively exhaustive, it’s not as important. But being mutually exclusive is key to efficiency in solving case interviews.
We hope that you enjoyed this video on being MECE through a case framework example. If you have questions about case interview structuring we would love to help. And we do reviews of case interview structures as well as we have a variety of drills available.