In this case, the problem is the same: we are advising Korean Car Parts (KCP), a multi-national original equipment manufacturer (OEM) of car parts based in Korea. They’ve recently seen a decline in profits and have brought us in to understand how to address this falling profitability.

This case “splits”, so to speak, right from the get-go. Instead of seeing rising profits in some geographies (Korea and Japan), as we saw in case one, Korean Car Parts is seeing falling profits across all geographies. This completely eliminates the need to split by geography, which is different to what we had to do in the first case.

As a result, we need to dive deeper into macro forces at play, and, specifically, what is happening across competitors (because the interviewer tells us some competitors are still succeeding).

Once we ask for the right data, we are provided with overall market data for products. Again, this is at the macro level because there is a macro problem, as opposed to the first case where we clearly had a geographic problem.

From this exhibit, we are able to identify that Wheels, Seatbelts, and Airbags are simply a declining market (not our fault), while the other two products are a growing market (so we are doing something wrong).

This tells us that the other two product markets (Carburetors and A/Cs) are being won by competitors. Therefore, of course we have to ask about competitors here!

As we are provided competitor data, we can see clearly that the two competitors with strong profit growth do not even sell Wheels, Seatbelts, and Airbags; they either never entered those markets or they left them already! Our conclusion is therefore that Wheels, Seatbelts, and Airbags are unattractive markets that we need to exit.

Note how our takeaway in this case is the same as in the prior case: stop selling Wheels, Seatbelts, and Airbags. However, how we got there is different. How we got there is different because the data, insights, and clues were different.

Viola case leadership.