market entry case study framework

Introduction | Case types | Sample framework | Example case

Market entry cases ask a candidate to evaluate a specific growth opportunity and decide whether or not the company should pursue it.

Introduction to market entry cases (Top)

For example, a classic market entry case might read like this:

“Retail Co. specializes in outdoor apparel for children. They’ve been very successful in the midwest and are considering launching in Canada due to similar climate and demographics. What factors would you look at to determine if this expansion would be successful?”

Just hearing this type of question makes some people nervous - where do you start and how do you evaluate the problem in a structured way? Don’t worry; after reading this post, you’ll be able to recognize a market entry question like this and crack it in no time!

Market entry cases are a very common type of case during the interview process. There are two reasons for this. First, they test a variety of skills consultants care deeply about: structured problem solving, logical reasoning and creativity. Second, consulting companies frequently help clients with market entry problems, and case interviews mirror real world consulting work. Since consultants often give candidates cases they’ve worked on with real clients, tso there’s a good chance you’ll get one of these eventually.

The good news is, these are fairly straightforward cases. We’ll go through one framework that can be used to solve these types of cases, as well as a more detailed example. As always, don’t forget that every problem is unique, and a great answer will always take into account the nuance of the problem and propose a tailored framework.

Types of market entry cases (Top)

There are three main buckets of market entry cases: geographical, product line expansion, and generic growth strategy.

1. Geographic expansion cases

The question you’re trying to answer in the geographical type is whether a company should expand their current business to a new market. For example, if Chipotle should expand into Europe, or if Uber should launch in China.

2. Product line expansion cases

In the product portfolio type of market entry case, the question is if a company should launch a new product into their existing market. For example, if Harley Davidson should launch an electric motorcycle, or if Whole Foods should start selling meal kits in addition to groceries.

3. Generic growth strategy cases

Sometimes market entry cases can be hidden in the introduction but appear partway through the case.

For example, your interviewer might say something akin to: “Client Co. has seen declining revenue recently. What should they do?” This is a growth strategy case, which could have various paths such as acquire a competitor or invest in internal R&D. One hypothesis may be expanding to a new market to grow their customer base. In this example, the market entry aspect of the case would branch out from a higher-level growth strategy problem.

Market entry case framework (Top)

Now that you’ve seen what market entry cases look like, let’s talk about how to solve them. There are four steps to these cases: assessing the target market, evaluating the company’s capabilities, quantifying the opportunity, and outlining a go-to-market strategy.

Assessing the target market

In this step, you’ll want to evaluate the market in question. The main goal here is to determine if the market is large, growing, and what the competitive landscape looks like. In addition, you’ll want to determine if there are any additional factors that might prevent a company from expanding successfully, for example, if there were a war in the country, high levels of corruption or anti-American sentiment.

Key questions include:

• How big is the market and is it growing?
• Who is the target customer and what are their needs or preferences?
• What is the competitive landscape?
• Are there any social, macroeconomic, or geopolitical factors to consider?

Evaluating company capabilities

Now it’s time to look internally, you’ll want to dive into the client’s business to understand their product offering, their current customers, strengths and weaknesses, and their financial situation. Just because a new market is attractive doesn’t mean a company should always expand there. The company needs to have the right characteristics to successfully enter.

For example, expanding into China might look like a good opportunity for a hotel chain, but if they don’t have anyone on their team with experience in China and have never grown internationally before, it will probably be a very tricky strategy to carry out successfully.

The key questions you’ll want to answer in this step are:

• What is the current product and customer mix?
• What are the strengths and weaknesses of the company?
• Who are the key suppliers or partners?
• What is the current financial position?

Quantifying the opportunity

If you’ve gone through the first two steps and decided the market entry is a good idea for the client, the next step is determining the investment that would be required to enter the market versus the expected revenue potential. In other words, would the juice be worth the squeeze?

• What share of the market could be captured?
• What would the primary costs of entry be?
• What are the outstanding risks?

Developing a go-to-market plan

The final step for a market entry case is laying out the ‘how’ once you’ve come up with an answer on whether or not to enter. There are several ways a company could enter a new market.

Each of these would be evaluated using pros and cons:

• Acquire a company in the target market
• Form a partnership with a company e.g. sell through a local distributor rather than direct to consumers
• Grow organically into the new market, either with an existing brand or through a new brand

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Example market entry case (Top)

Let’s try going through a market entry case using the framework above. The question we’ve been given is: “Taco Bell recently expanded into the UK with great success, should they launch in France as well?”

We’ll walk through each question below and demonstrate the kind of thought process the candidate should be going through (and voicing over to the interviewer) if they were in a real case interview. Remember, this isn’t how an actual conversation would go, but it does provide an example of how this framework could be applied to a real question, and the types of issues you should be thinking about.

Step 1: Assess the market

We’ll begin by assessing the attractiveness of the French market. Let’s go through our key questions:

How big is the market and is it growing? Here, we’d want to know how big the fast food market is in France and what the growth rate is. Let’s say our interviewer tells us it’s a $50B market and has been growing at 12% for the past 3 years. Right away, we see that this is a large and rapidly growing market, which means this is an attractive place to be at a high level.

Who is the target customer and what are their needs or preferences? Based on what we know about Taco Bell domestically, we can build a profile of the target customer: someone who goes to other fast food restaurants, is looking for a quick and cheap meal, enjoys Mexican food, and isn’t very health conscious. The biggest question is if this type of consumer is as prevalent in France as they are in the US. We might receive additional information from our interviewer that the French don’t prefer spicy food and aren’t as familiar with Mexican cuisine.

What is the competitive landscape? Competitors to Taco Bell would include any other businesses that meet the same customer needs mentioned above. For example, other fast food restaurants or other Mexican restaurant chains that are popular in France. In this case, we’re told there are no direct competitors (no Mexican fast food restaurants) but McDonalds, Subway, and Pizza Hut have ~25% of the fast food market.

Are there any social, macroeconomic, or geopolitical factors to consider? Here we could bring in any current events that might impact our strategy. For example, we might know that the minimum wage in France is much higher than the US. This higher cost of labor could cut into Taco Bell’s profits if they weren’t able to raise prices to offset it.

Overall, after a quick evaluation of the market, it appears to be an attractive region for a fast food restaurant, but there’s an open question on the customer preferences piece and whether French people will embrace Mexican food.

Step 2: evaluating company capabilities

The next step is looking at Taco Bell’s current performance and determining if they would be successful expanding into France:

What is the current product and customer mix? Taco Bell serves lunch and dinner with a broad menu of American Mexicanized food. Historically, their largest customer segment is 18-25 year old men, although menu additions such as salad bowls have aided in their effort to attract 25-35 year olds as well as women. Domestically, the bulk of their business comes from drive-thru orders, however, in the UK their urban locations attracted a broader demographic, including teens and families.

What are the strengths and weaknesses of the company? Taco Bell is a well known brand that’s recognized globally. They’ve recently proved an ability to successfully co-brand menu items (for example their domestic partnership with Doritos) which could be employed abroad with popular brands in the target country. In addition, their success in the UK has shown they have the skills and experience needed to launch in a new market.

What is the current financial position? Taco Bell’s revenue is ~$11B and has been growing in the double digits recently. We would also want to look at same store sales to determine if revenue was growing solely due to expansion or if existing locations were also seeing an increase in business.

From this quick look, we see that Taco Bell is in a solid place financially and has a dominant position in the market. They’re experienced with new market entry as well.

Step 3: quantifying the opportunity

Now we want to determine if expanding into France will be financially attractive for Taco Bell.

What share of the market could be captured? Of the $50B fast food market, how much do we think Taco Bell can capture? At this stage, we would likely be given some additional information, such as the market share of the largest competitors. We find out McDonalds has a 10% market share and they’ve had to transform their product in order to be successful - focusing on a Cafe area and larger seating spaces. In this case, we might assume Taco Bell could eventually capture just 1% of the French fast food market, or $500M, as the cuisine isn’t nearly as popular

What would the main costs of entry be? The primary costs would include real estate, building the team, and doing market research to develop a menu tailored to local tastes. Marketing would also be a large cost to educate the French market about their brand and product.

What are the outstanding risks? The biggest risk for Taco Bell is there’s no product-market fit e.g. the French consumer doesn’t eat Mexican food. One way to mitigate this is to start with a very small footprint, just a couple locations, and put them in a densely populated area with a more diverse population.

Step 4: Developing a go-to-market plan

Finally, we would want to recommend a strategy for Taco Bell to enter France. In this case, growing organically makes the most sense as the brand is the major strength. Starting with a couple locations in Paris where there is lots of foot traffic and both locals and tourists makes sense. Additional market research would need to be done to determine which menu items should remain and what should be added to localize the flavor profiles.

You’re bound to get a market entry case during the interview process, so it’s a good idea to get familiar with this framework and the types of questions you’ll be looking to answer. Your interviewer will guide you through the process a bit in terms of the additional information they start to share, so you’ll see where to push more or less. Remember, these are real problems clients are looking for advice on, so it’s great practice in that regard as well!

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Top 7 case interview frameworks (and how to create your own)

Today we're going to cover the top case interview frameworks, as well as how you can create your own custom frameworks. 

Understanding frameworks has always been critical for the 8,000+ candidates who we've helped with consulting interview preparation. 

And one of the first things you'll want to know is that you should AVOID using pre-made frameworks, like those recommended in Case in Point and in Victor Cheng's LOMS programme. But more on that later. 

Let's start with the list of top frameworks.

• 1. Profitability
• 3. Porter's 5-forces
• 5. Market entry
• 7. Merger and acquisition

Don't reuse pre-existing frameworks

How to create custom frameworks, click here to practise 1-on-1 with mbb ex-interviewers, top 7 frameworks for case interviews, 1. profitability framework.

The   profitability framework   is the most basic framework in business analysis. It simply breaks down profit into its basic revenue and cost components and is commonly used to identify the root cause of profitability issues.

• Revenue   can simply be broken down into the Number of Units Sold x Price Per Unit.
• Costs   can be broken down into Variable and Fixed Costs. And Variable Costs can be further broken down into the Number of Units Produced x Cost Per Unit.

2. The 4Ps framework

The   4Ps framework   is widely used by company executives to design their marketing strategy. There are different variations of this framework, which is also sometimes referred to as the “Marketing mix” framework, but the 4Ps is the most common one.

This framework is commonly used when launching a new product or when reviewing the positioning of an existing product.

• Product : What are the key characteristics of the product sold? Key elements of the product definition could include: customer need fulfilled by product, product usage (E.g. who, where, how, etc.), good vs. service, product lifecycle (new vs. established), competing products and substitutes, etc.
• Price : At what price should the product be sold? Different considerations need to be taken into account here: the customer perceived value of the product, the price of competitive products, the customer price sensitivity, the cost of producing the product, etc.
• Promotion : Which promotion strategies should be used to sell the product? Key elements to consider include: promotion messages, media type (E.g. TV, social media, radio, etc.), best time to promote, competitors’ strategies, etc.
• Place : Through which channels should the product be distributed? Key elements to consider include: possible channels to distribute the product (E.g. in store, web, mail-to-order, etc.), customer expectations in terms of channel, requirement of a sales team or not, competitors’ strategies, etc.

3. Porter's 5 forces

Porter’s 5 forces  is a framework commonly used by CEOs to explore the competitive dynamics of industries. Indeed not all industries are structured the same way.

Some industries are really hard to get into (E.g. banking) while others have very low barriers to entry (E.g. newspapers).

Suppliers have strong bargaining power in some industries (E.g. high-end medical equipment) but little power in others (E.g. small milk producer), etc.

Understanding these dynamics is extremely important when you're considering entering a new industry or when assessing the competitive dynamics of the industry a company is already in.

• Bargaining power of customers : How much bargaining power do customers have? If there is only one buyer but multiple suppliers, then that buyer will be at a strong advantage. Key elements to consider here include: customer concentration (percentage of industry revenues from Top 3 buyers), customer price sensitivity, customer information availability, etc.
• Bargaining power of suppliers : How much bargaining power do suppliers have? Similarly to the previous point, if there is only one supplier but multiple buyers, then that supplier will be at a strong advantage. Key elements to consider include: concentration of suppliers (percentage of industry revenues to Top 3 suppliers), difficulty of switching from one supplier to another, differentiation between suppliers, etc.
• Threat of substitutes : What are the substitutes for the product and are they increasingly popular? As a reminder, water is a substitute for Coke while Pepsi is a competitive product for Coke. Key elements to consider here include: potential new substitutes, ease of substitution, evolution of customer propensity to substitute, etc.
• Threat of new entrants : How difficult is it to enter the industry for potential new players? Key elements to consider here include: regulation authorisations, capital requirements, economies of scale, network effects, etc.
• Existing rivals : How competitive are existing rivals in the industry? Key elements to consider include: number of competitors and their market shares, similarity between their products and products of the firm analysed, financial health of competitors, etc.

4. 3Cs framework

The   3Cs framework   is also commonly used to put together strategies for companies. As you will notice below, a lot of its components overlap with the Porter’s 5 forces.

• Customers : Who is the customer? Key elements to consider include: customer demographics (E.g. age, sex, income, etc.), customer needs, customer segments' size and growth rates, customer willingness to pay and price sensitivity, etc.
• Competition : What are the competitive dynamics? Key elements to consider include: competitors’ value proposition and brand, competitors’ market share and growth, competitors’ financial health, etc.
• Company : What defines the company? Key elements to consider include: product offering, profitability, core competencies, unique selling point, financial performance and resources, etc.

5. Market entry framework

The   market entry framework   is commonly used to make decisions on whether a company should enter a new market or not.

For instance, you could use it to decide if Starbucks should enter the Chinese market, or if Nike should enter the sports broadcasting business.

• Market : What are the characteristics of the market we are trying to enter? Key elements to consider include:   market size  and profitability, products already available in the market, intensity of the competition, heaviness of the regulation, etc.
• Client capabilities : Does the client have the right capabilities to enter that new market? Key elements to consider include: differences between the client's current market and the new one they are now targeting, number of times client has entered new markets and achieved success, other companies already in the new market, etc.
• Financials : Does it make financial sense to enter the new market? Key elements to consider include: current financial situation of the client, cost to enter the new market, ongoing costs once the market is entered, expected revenues and return on investment, etc.
• Entry strategy : How should the client go about entering the new market? Key elements to consider include: timing of market entry (now vs. delay), speed of market entry (test region vs. whole country), opportunity to buy competitor or do a JV, management approach (control from HQ vs. decentralise), etc.

6. Pricing case framework

Companies always face a difficult issue when launching a new product or service. What should its price be? The   pricing framework   is extremely helpful for answering that question.

• Cost-based : What price do we need to set to cover all our costs? Key elements to consider include: fixed costs and their allocation across products, variable costs and number of units produced / sold, profitability targeted, etc.
• Value-based : How much are customers willing to pay for our product? Key elements to consider include: price of the next best alternative to our product, features that make our product better than the next best alternative, value of these features, etc.
• Competitor-based : What is the competition charging for similar products? Key elements to consider include: available substitute products from the competition, price of these substitute products, value of our product vs. substitutes, etc.
• Overall strategy : Given the elements above, what should our pricing strategy be? Key elements to consider include: objective of the pricing strategy (E.g. high profitability or high market share), opportunities for upsell / cross-sell that should be taken into account (E.g. Kindle and ebooks), possibility to sell different versions of the same product (E.g. iPhone 13 and iPhone 13 Pro), etc.

7. Merger and acquisition framework

Finally, the   merger and acquisition framework   is used when companies are looking to acquire or merge with competitors.

These situations are not very frequent in a CEO's life, but they are highly stressful, which is one reason why consultants are often asked to support such initiatives.

• The market : What are the characteristics of the target company's market? Key elements to consider include:   market size  and growth, market profitability and intensity of the competition, market regulation, etc.
• The target : How attractive is the target to be acquired? Key elements to consider include: current and future financial position of the target, important assets or capabilities owned by the target, quality of the target's management team, target / buyer culture fit, etc.
• The buyer : What's driving the buyer to make the acquisition? Key elements to consider include: acquisition rationale (E.g. target undervalued, etc.), acquisition financing, buyer's acquisition experience, acquisition timing, etc.
• Synergies and risks : What are the acquisition synergies and risks? Key elements to consider include: value of individual and combined entities, cost synergies, revenue synergies, biggest risks of failure, etc.

Once you are generally familiar with frameworks, the question becomes: how do you actually use frameworks in case interviews?

There are a lot of opinions about how you should do this on the Internet. But the two main schools of thought are   Marc Cosentino’s Case In Point   and   Victor Cheng’s LOMS .

But both of these methods share the same flaw: they try to force pre-defined frameworks onto cases. In our experience, this is bound to produce average results because all cases are unique.

Not convinced? Let's cover each of these two popular methods in more detail. 

Why NOT to use the Case In Point frameworks

In Case In Point, Marc Cosentino attempts to classify case interviews into 10+ categories and then suggests that candidates should memorise a specific framework for each of them.

This is an interesting exercise as it exposes you to a range of business problems and helps you think about them in different ways. However, in our experience, learning 10+ frameworks is difficult and time consuming.

More importantly, in live case interviews, trying to recognise one of the 10+ case categories and then remembering the associated framework is a real nightmare!

Instead of focusing on solving the problem at hand, you end up trying to remember a framework that will not even perfectly fit the case you are solving. In our experience, the best candidates avoid this strategy.

Why NOT to use Victor Cheng's LOMS frameworks

In his LOMS programme, Victor Cheng advocates for a much simpler method and suggests you should only learn two frameworks: the profit framework for profitability cases, and a general framework for all other cases (Product, Consumer, Company, Competition).

The benefit of this approach is its simplicity. It gives you a starting point that’s easy to remember when you are putting a framework together.

However, in our experience, this approach has a fatal drawback. In practice, there aren’t that many profitability cases, and you basically always end up using the general framework.

Even if you adapt this general framework, it won't be perfectly tailored to the case you are trying to solve. More importantly, your interviewer will quickly realise that you are using a pre-made framework and that will reflect negatively on you.

Why to create custom frameworks instead

A good framework is a bit like a tailor-made suit: it is adapted to the problem you are trying to solve, the company, the industry, and it is also as   MECE   as possible.

If you use pre-existing frameworks, you run the risk of missing important elements of the specific problem you are trying to solve. In real life, consultants rarely use pre-defined frameworks. They are familiar with them, but they do not directly re-use them as-is on projects.

Instead, they create a customised framework or   issue tree  that addresses the specific details of each case.  To do so, they rely on conversations with their client as well as past experiences.

This might sound intimidating, but the good news is that creating custom frameworks is actually much simpler than you might think. 

Now, let's turn our attention to HOW you can create your own custom frameworks during case interviews. 

Here's a brief summary of the steps you'll need to take:

Summary - IGotAnOffer method (framework development questions)

• Step 1: Ask for time to gather your thoughts
• Extract the main elements from the case question
• Break down the main elements into components

Spin your paper around

• Begin with an overview

Highlight 3-5 considerations for each branch

Summarise your points, prioritise next steps.

Now let's cover these steps in more detail. We'll also be digging into a real case example below, in order to illustrate the framework creation process.

1. Ask for time to gather your thoughts

Regardless of the case you get, you should always ask your interviewer for some time to gather your thoughts, before you begin to develop the framework. 

This is a normal part of the interview process. Your interviewers will expect you to ask, and they'll almost always give you this time. 

But don't get carried away! 

For reference, you should only take 30-60 seconds to quietly think-through your framework. We recommend that you also sketch out your framework on a piece of paper during this time, as that will help you to organise your thoughts more clearly. 

Without practise, it's really difficult to estimate how long 30-60 seconds actually is, so we highly recommend that you practice this process with a stopwatch. This exercise will help you get a clear idea of how much time you're actually using. 

2. Create the framework

During that 30-60 second time window, you'll need to do the real work of crafting your framework. 

The essence of framework creation is actually quite simple. A framework takes the business situation presented in the case, and breaks it into smaller "bite size" pieces. 

By isolating the various components of a case, you'll be able to better identify the root cause of an issue, or find the best opportunities for improving the underlying business. 

And the best way to develop your framework creation skills is with practice on realistic case problems, so let's walk through an example together. 

Star Production case example

In this case we need to analyse the short-term profitability of a movie production company. So, you would begin crafting your framework by thinking about the different factors that would contribute to the company's overall profits.

The first two components of this framework are fairly straightforward: revenues and costs. That's because the profitability of any company is determined by a combination of their revenues and costs.

Then, we can further deconstruct both revenues and costs based on our knowledge (or perhaps some assumptions) of the movie production business. And as you break down the components further, it's important to consider the concept of MECE, which stands for Mutually Exclusive Collectively Exhaustive.

In simple terms, MECE means that you should aim to have a framework where the branches do NOT overlap with each other, and where the framework is comprehensive (i.e. no branches are missing). You can learn more about this in our separate   MECE guide . 

Now here's an example of what your draft framework might look like for the Star Production case: 

As you can see in the example above, we've broken down the revenues and costs into specific components that would make sense for a movie production business.

And we've used bullet points to highlight the information we would need in order to determine how each individual item contributes to the overall revenues or costs of the business.

For example, we would need to know the expected ticket sales, the average ticket price, and the share of the ticket revenue that Star Production would be entitled to, in order to calculate the total ticket revenue. 

Once you've drawn out a rough framework like the above example, your next task will be to explain your framework to your interviewer. 

3. Communicate the framework

Even if you created the world's best framework, it won't get you an offer if you're not able to explain it in a clear and structured way. 

Here's how we'd recommend you communicate your framework during your interviews:

Start by showing your interviewer the framework that you've drawn on paper. Having this visual structure will make it much easier to explain (and understand). 

Start with an overview

Before jumping into the details of your framework, you should start with an overview of the framework.

In our example above, you could simply explain that the profitability of Star Production will be determined by the expected revenues and costs of the business, which can be broken down into more specific categories. 

You should also tell your interviewer the order in which you plan to walk through each individual branch, so they'll know what to expect.  

Next, go through each branch of your framework and mention several considerations that came to mind while you were drafting the framework. 

For example, for the "upfront costs" branch of the Star Production case, you could explain that you'd want to find out what costs the company would incur before it can start releasing movies, like filming equipment, studio space, and post production expenses. 

And throughout your explanation of the framework, you should pause periodically to summarise your key points, and to check in with your interviewer. 

You're likely going to be covering a lot of ground in your framework, and you want to make sure that your logic doesn't get foggy in the details. 

For example, you could summarise the most important considerations that impact the revenues of Star Production, after you've walked through each individual sub-branch under revenues. 

Finally, after walking through your full framework, you should tell your interviewer the 2-3 next steps you would recommend, in priority order. 

There's a variety of ways you could rank next steps, but three good options would be based on importance, ease, or speed. 

Returning to the Star Production example, you could recommend the following next steps in priority order:

• Identify the biggest cost drivers.   Star Production's business model is focused on producing a high volume of low cost movies, so controlling costs will be essential to the profitability of the company. 
• Develop a production process that minimises costs.  Once the primary cost drivers are identified, we should develop a production process that keeps those costs as low as possible. 
• Look for opportunities to increase the hit rate.   Star Production is counting on a few box office hits to drive revenues. As a result, increasing the percentage of movies that succeed could be a big win.

Get MBB offers by mastering frameworks

To succeed in case interviews, you MUST be able to create and apply frameworks effectively. And i f you really want the best possible preparation for your case interview, you'll want to practise doing this in an interview situation, ideally with an expert consultant giving you feedback.

That's why we’ve created a coaching service where you can do mock case interviews 1-on-1 with ex-interviewers from MBB firms . Start scheduling sessions today!

Related articles:

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Market entry, market entry could be a possible solution that may not be obvious at the beginning of a case, market entry problems have two variations, according to the ansoff matrix.

• Introduction of an existing product in a new market (market development)ge.com/en/case-interview
• Introduction of a new product in a new market (diversification)

As you know from the Ansoff Matrix , usually  growth questions  require a market entry strategy for the case interview solution. “Our business model is currently stagnating. What should we do?”

Use the following five steps to approach a market entry case

1. Paraphrase and clarify the objective at the beginning (same as all other cases)

As usual, take good notes! Start with paraphrasing the problem and clarify all questions to make sure you understand the problem. Take a minute to structure your thoughts and decide the questions you want to ask based on the structure. In short, in order to have a market entry strategy, you need to:

• Understand the company and its current market, and also the new market the company wants to enter.
• Evaluate the financial aspects.
• Evaluate the economic implications of entering the market. If it makes sense, decide how: Through organic (independently) or inorganic (inter-dependently)? If inorganic, then would it be through a Joint Venture or M&A?

Frameworks such as  Porter's Five Forces  can help you structure thoughts and systematically uncover key information. But, in an interview, avoid saying that you are using Porter's Five Forces or any other standard framework as you run the risk of portraying yourself as force-fitting a framework. 

2. Understand the client's company

Understand why the client wants to enter the new market and identify the key issue. Knowing this piece of information will be important in making the final recommendation. 

Other important information:

• What are current revenue streams?
• What are the client's key strengths and weaknesses? ( SWOT )
• What is the product mix? How many and what types of product lines, brands, variations of products does the company have? What is the lifecycle of each product? Also, how closely related are the current products?
• Who are current customers, and how are they segmented?
• What are the current distribution channels?
• What is the client's current financial situation ?

3. Understand the market of interest

Understand the market the client wants to enter and evaluate its attractiveness. Start by estimating the market size if that information is available (it is implied that you would first need to estimate market size in such cases).

• What is its growth rate ?
• At what stage of the lifecycle  is it? Emerging, Mature, Declining?
• What are the customer segments, and what are their respective needs?
• Is there a key technology involved? If so, how quickly is it likely to change?
• What are current trends in the industry?
• Who are the key players in the market? What is their market share? What are their differentiating factors?
• What is their response to the determined key trends?
• Are there substitute products?

4. Evaluate the financial aspects

Key questions:

• Costs: What are barriers to market entry (i.e. investment costs)?
• Costs: What are expected fixed and variable costs?
• Revenues: What is the expected price of the product for and how many units are expected to be sold?
• After how many years will the client break-even and what is the rate of return ( understand that money has a different value over time )?

5. Evaluate the economic implications of entering the market

Remember you do not need to investigate  all  these questions, but you do need to evaluate and understand what questions are important by considering the reasons the client wants to enter the market. 

If you decide that entering a new market is a good idea, it would make sense to recommend to the client  how to do it .

Entering a new market can be generally done in three key ways:

• Start from scratch
• Through a Joint Venture
• Through M&A

Based on the data, if you decide that the venture is not a good idea, recommend an alternative plan (product differentiation, cost-cutting, international presence, etc.). Since you now know the company structure, the “old” and the "new" market, make sure to structure your recommendation.

• Competitive advantage : Can you apply the same business strategy as in your current market, or do you have to adapt the product, marketing, or even sales channels to reach customers?
• Timing:  Can you lever a first-mover advantage, or would you rather let the competitors try their luck first?
• Speed of entry:  Define whether you want to test a single store or region, or whether you want to cover the entire market at once.
• Entry mode:  How much commitment are you looking at? Would it be a simple export strategy, where you can exit easily but have less control, OR a wholly owned subsidy, where investment costs are high, but you also have more control?
• The organizational structure  of the new branch: Do you want to decide centrally or leave lots of freedom to the individual manager of the country?

Once you have all your answers, synthesize them to give a recommendation based on the facts you collected. Don't forget to take another minute to structure your answer but make sure to provide your answer first and then the reasons! Check out our article about the  pyramid principle for more details regarding communication. 

Key takeaways

• Market entry cases are often hidden in other case types, such as cases involving increasing revenues of a company.
• Look for the most  critical success factors  for the client.
• When developing a market entry strategy, focus on how the new market fulfills the success factors sought by the client.
• Make sure to lay out several different market entry strategies  and evaluate those against each other.

Questions on This Article

Cost revenue and entry strategy, why assessing 2. company financials prior to 3. targeted market/customer interest, market entry case with multiple choices, related cases.

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The ultimate guide to market entry

Entering a new market can lead to a massive boost to sales, brand strength and long-term profits. But there’s more to a market entry strategy than great products or services. Understanding the local market – its distribution channels, culture, economic and social trends – through a market research-driven due diligence process is crucial. And sometimes the most valuable insight is the hidden reason why you shouldn’t proceed…

The art and science of market entry

Over the past 40 years globalization has redefined what it is to be an international brand. For decades, a handful of dominant players in markets such as food and drink (driven by marketing prowess) or automotive (reliant on economies of scale) had been able to enter new markets in ways that most businesses simply couldn’t imagine.

The rapid growth of global trade capacity, and particularly the ubiquity of the internet, has levelled the playing field. Today, a business in Bolton has myriad options for selling in Beijing; an Australian specialist retailer has lots of ways into the Austrian market.

But the process of choosing which markets to enter, how and why remains fraught with danger. The rewards of opening up a new market are potentially great . On the other hand, the cost can be significant, and the list of powerful global brands that have failed to successfully enter new markets is a long.

The factors to consider are varied: there are economic and social dimensions, competition from local companies, the quirks of regional distribution channels, cultural mismatches… and much more. That means undertaking a market-research-driven due diligence project before entering a new market is a must.

Why look elsewhere? The reasons for market entry

What motivates companies to investigate entering a new market? Every organization will have its own reasons. Exploring them in detail is a useful first step in defining the later market entry strategy.

Brand growth 

A huge proportion of value in modern enterprises is wrapped up in intangibles. That means increasing enterprise value requires diversification of the brand. Some very strong domestic brands can move into adjacent markets (Dyson, for example, can leverage its reputation for air-moving engineering from vacuums, to hand-dryers, to room fans and even hair straighteners). A select few can jump into non-adjacent categories (Virgin, for example). But opening up a whole new geographic market can establish a brand with many more consumers, boosting its value.

Saturation of existing markets

Once you have gained significant market share and consumer penetration domestically, it’s easy to see growth stall. Launching new products to address existing customers is costly and high risk. But taking proven products or services to a new market can create fresh upside for growing brands.

Optimizing overhead costs

As businesses grow, they build up overheads – around head office functions, for example. They also build up niche skills and experience – in fields such as logistics, legal or financial. These scale well: the more times you can put your experts to work in a new market, the more productive they are. And the more markets you have, the lower the amount each one pays to meet head office costs.

Strategic partnership

Globalization has meant businesses can easily work with partners in new markets – creating new opportunities for blended products and services. Local distributors, for example, might be pathfinders for a brand into a new market – demonstrating the potential for a more structured entry into that market.

There are plenty of other motivations, often overlapping. Knowing which is driving the decision to explore new markets will help frame the strategy for successfully entering one.

A phased approach to market entry

There are different phases to a market entry project. You need to size the opportunity to judge whether it’s worth entering a new market. There ought to be concept testing, especially for new categories or innovations in that market. Many clients focus on competitor analysis when they’re dealing with less well-known rivals.

Market entry has many dimensions – and no business is too big to skip them.

We work with a number of high-profile Japanese brands, global names that are already present in different countries in some form of another. But they still need to tailor particular products or brands to the local markets they’re looking to exploit; and understand the specific needs of consumers in those categories.

Market entry projects usually involve a series of questions, and typically each of these is a discrete engagement.

Key questions for any market entry project

• Which markets might we look at?
• What is the macro environment like in a market we want to enter?
• How does the competitive landscape affect its attractiveness?
• What is the best way to enter the market in practical terms?
• How do we adjust our product, service or messaging to optimize our offer there?

While market entry studies are a vital tool in successfully growing a brand somewhere new , sometimes their value comes from showing that entering a new market will not be successful. Around 50% of these projects results in a recommendation not to go ahead as planned. That finding can emerge at any one of the stages above. Far from being bad news, it’s often the most valuable insight a brand can get. Market entry can be costly and complex – not doing so when the conditions aren’t right can save massive amounts of money and time.

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The world is your oyster. But where’s the pearl?

A crucial first step in investigating markets for entry is to analyze why a brand, product or service is successful in its existing markets . How is it used? Who are the type of people that love it? What are those customers’ attitudes across different domains? What role does it play in their lives – and why?

The next step is to look for markets where groups like this already exist . A good starting point can be detailed desk research – using tools like the CIA World Factbook for demographic information, or understanding cultural similarities to your home market through cultural awareness studies like the Hofstede Insights Culture Compass . But ultimately, it’s approaches developed precisely for the brand or product that will reveal good matches. Narrowing down the high-probability markets is hugely valuable for brands that don’t have other clues to go on.

Sometimes brands do have a clear idea from the outset which markets they want to enter. We worked with a company producing ceramics which had a light-touch arrangement with an international distributor. They started to notice a significant uptick in orders from Korea – which was obviously a strong signal that entering that market could pay dividends.

But that also meant understanding why was key to a successful market entry. Closer research revealed that an increase in purchasing power among the country’s middle class had made the designs more attractive; plus online shopping had taken hold and made previously hard-to-get products more visible.

Target acquired. Now what? Next steps in a market entry project

Specific country research starts with fundamental market insight and competitor intelligence work. Initially, that’s secondary research, analyzing available insights for the particular category in question. After that, we might move on to interviewing people whose knowledge of the market will provide more nuanced insights.

Companies usually see this as their feasibility study , helping them understand who else is operating in their category, what regulations might be applicable, what the domestic distribution and supply chain infrastructure is like, and what investment they’re likely to need to make under different scenarios.

That industry analysis and expert insight helps generate a strategic overview of the market tailored to the client. Often that’s enough to substantiate the decision on whether and how to enter a market, especially if it’s a close match with the brand’s existing markets.

A good example is some work we did with an electronics brand looking to launch a new product in the US. The group already has a huge presence in America – but not for its new product, a battery system for domestic renewable electricity.

Our project involved interviewing a range of potential stakeholders – such as real estate developers, housing associations, planning authorities and environmental regulators – to get a holistic view of how that market might evolve. That enabled the client to take a realistic view of both the existing appetite for the product and current regulations; and how the landscape might change as they developed the product.

It’s not uncommon for a company to walk away at this point – there might be competitive, regulatory or infrastructure barriers that no mode of entry can overcome cost-effectively.

Frameworks to assess a new market

A structured framework can be valuable in assessing a new market. You might see great consumer interest – but if the regulatory stance is hostile, you have to think twice. One way of conducting a thorough overview of a market to pick up all those factors is to analyze the environment through different PESTLE lenses :

• P olitical – how stable is the country? What’s the prevailing ideology? What biases – intervention in markets, say, or taxation – do politicians have?
• E conomic – how rich is the country? How is wealth distributed? What’s growth like, and where is it likely to continue?
• S ocial – what’s the culture in the country? What are the typical social structures – family, work, community? What about religious norms? Education levels?
• T echnological – what’s the infrastructure like? How wired is the country? How lumpy is technology penetration? What about population ‘techiness’?
• L egal – what rules are there about business ownership? How about liability laws? What recourse do overseas businesses have in the courts?
• E nvironmental – how might the local climate affect the product or service? What about use of resources? Or end-of-life disposal of products?

Porter’s Five Forces

The next step is to get a grip on the competitive landscape, and that’s where tools such as Porter’s Five Forces come in. Michael Porter worked at Harvard University, and in 1979 he published a paper aiming to describe the ‘microenvironment’ for the attractiveness of any given industry – or, in this case, a new market.

There are three forces from ‘horizontal’ competition:

• The threat of substitute products or services – what’s the alternative to your own offering that people might use? How are they achieving the same goals now, and what might shift their views?
• The threat of established rivals – bearing in mind that in a new market for you, there will be lots of players who know how to operate there better than you do.
• The threat of new entrants – being a new entrant to a market doesn’t mean others won’t follow, too. And if you’re establishing a new category in a market, that might tempt others in, or prompt local businesses to muscle in.

Two forces come from ‘vertical’ competition:

• The bargaining power of suppliers – opening up a new market might help you gain economies of scale from higher sales volumes. But it also makes you more reliant on suppliers – especially around issues such as logistics.
• The bargaining power of customers – understanding the broader competitive landscape will help you see what choices customers have; but, especially in the initial phases, they might need to be tempted to switch brands or try a new category.

Digging into the nuances

Those kinds of analytical tools mean companies can enter a new market with their eyes wide open. But they’ll still need to develop a sophisticated view of customers, competitors and regulations – the kind of insights that will tell them how they might enter a market, not just whether it’s a good idea.

That’s when they’ll commission more in depth market research and run projects like a market segmentation analysis to dig deeper into nuances they can exploit later to optimize their market entry.

At this point, they’ll be starting to research more detail on potential partners; exactly how they would use infrastructure to import, manufacture and distribute in that market; what specific customer niches exist; and even financial planning to take into account the kind of regulatory and cost-of-trade analysis they revealed in the feasibility study.

But above all they need to understand how their brand might be received. It’s not a given that you can simply transplant over your image or core messages.

Culture and behavior: getting the key variables right

Cultural fit is hugely important. In this phase of the project, we would drill down into the local factors that might help a brand; or create barriers for its acceptance. This is typically a traditional market research exercise, exploring the behavioral aspects of consumers in the new market.

For example, we worked with a Japanese food manufacturer looking to expand into new Asian markets. But in the Philippines, it quickly became clear that there was no appetite for the more subtle flavorings and preservatives in the Japanese product. It was the perfect case of a potentially costly market entry being avoided through strong research findings.

That’s a lesson Pret a Manger learned in Japan , where it opened 14 sandwich shops across greater Tokyo in 2003. Just 18 months later, the company withdrew after its local partner, McDonald’s Japan, pulled out citing heavy losses. Superficial research indicated that Japanese people would love the convenience and novelty of eating-on-the-go sandwiches. But once the novelty wore off, sales dipped quickly. That combination of financial and cultural barriers hadn’t been picked up.

Speaking the language

As well as deciding whether the consumer will use the product, it’s important to explore the way in which it’s marketed. This is particularly important for brand with an established global image – the logos, slogans and even color palettes that they’ve invested in heavily to define themselves – because those might have unexpected connotations in a new culture. Take, for example, the beauty treatment marketed in Japan as “for clear skin” – which translated elsewhere in Asia as “ghostliness”.

There have been plenty of cases of companies that didn’t do their market research with disastrous consequences:

• Clairol’s ‘Mist Stick’ curling iron flopped in Germany: ‘Mist’ is slang for manure.
• Coors’s slogan ‘Turn It Loose’ translated into Spanish is slang for diarrhoea.
• KFC is known globally for being ‘finger-licking good’ – which translated as ‘eat your fingers off’ in China.
• Also in China, ‘Pepsi Brings You Back to Life’ was interpreted as ‘Pepsi Brings You Back from the Grave.’

But rival Coca Cola entered the China market much more deftly. Initially, signs produced by local distributors for ‘ko-ka-ko-la’ (using symbols for the closest phonetic translation) were translated as ‘bite the wax tadpole’. But the company was developing its own local brand positioning, and settled on the symbols ‘K’o-K’ou-K’o-lê’ – which means ‘to allow the mouth to be able to rejoice,’ a far more apt trademark that it registered in 1928.

The money question – how to approach pricing

The other marketing fundamental that research can steer is pricing – a factor every market entry project needs to examine. Where is the competitive price point for consumers in the new market? What volumes and margins might you expect, based on the market opportunity? How does the new market stack up cost-wise – are you importing or manufacturing locally, for example – and what does that do to your opportunity to flex prices?

More broadly, the profitability of different business models often dictates whether and how to enter a new market at all. For some businesses there’s relatively little financial penalty to operating exclusively through local distributors. But at a certain point, issues such as volume of sales, cost of distribution, tariff levels, changes to local taxes and so on will shift the financial rationale. For example, we’ve already seen many UK businesses enter EU markets directly as a mean of offsetting post-Brexit tariffs, staffing, distribution and other costs.

The financial calculations can also dictate the viable means of getting into a market. At one level, that’s purely a ‘treasury’ consideration. How will profits be repatriated? What are the currency risks associated with the new market? How does banking and taxation work there? But how much you can control the brand locally – rather than relying on local agents – is also a factor. (We’ll look at the different modes for entering new markets in more detail in a separate guide.)

Know when to hold… and when to fold

All these factors are a reminder that even strong and established global brands don’t always have an easy time expanding into a new market. They might have some leverage with their global brand name. They have the resources to invest in market penetration. But to do so effectively – and without incurring higher opportunity costs elsewhere – they need data and insights to ensure their entry is tailored.

Even brands that take precautions to adapt to local culture can miss valuable clues as to their viability in a new market. Starbucks famously waited 47 years to open its first branch in Italy – wary of the very particular approach to coffee there. In 2018, its first shop opened in Milan. But the brand has struggled in the country. Limited research into new markets had affected the brand before, with its Australian business failing to meet the demands of local coffee-lovers; its Israeli operation closed in 2003 within two years of launch.

Granular, holistic research is the key

To gain the right insight to inform your market entry strategies , you’ll need to work with external agencies. For some very fast-growing and global brands, there might be a case for building an in-house team with the kind of expertise and experience needed to evaluate new markets in sequence. But when it comes to local research expertise and cultural understanding, the insights can often be two-dimensional.

McDonald’s Japan is a great example of using local insight to tailor what is, on the face of it, a universal brand. Every country has their tiny variations in the McDonald’s menu. But visitors to Tokyo will find radical departures such as Ebi Filet-o (a burger with breaded shrimp); Teriyaki McBurger; and even chocolate fries.

For many businesses – and business models – international expansion is likely to be a multi-year project with long pauses. That means bringing agencies to advise and evaluate each market entry is the only practical solution – especially if they bring specific knowledge on particular markets to bear.

At Kadence, with offices spanning Europe , the US and Asia Pacific , we are well positioned to support brands with market entry research. Find out more about our market entry services or get in touch to discuss a potential project.

Helping brands uncover valuable insights

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Kadence’s reports give us the insight, conclusion and recommended execution needed to give us a different perspective, which provided us with an opportunity to relook at our go to market strategy in a different direction which we are now reaping the benefits from. Sales & Marketing Bridgestone

Kadence helped us not only conduct a thorough and insightful piece of research, its interpretation of the data provided many useful and unexpected good-news stories that we were able to use in our communications and interactions with government bodies. General Manager PR -Internal Communications & Government Affairs Mitsubishi

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How to Solve a Market Entry Case Interview

Market Entry cases often involve strategic questions such as: ‘Your client Company Z is currently manufacturing and selling coffee machines. It is now considering to enter the microwave market. Should they do that?’ In some cases, the answers to these questions are simple YES-or NO-answers, but in other cases the client might also want to know HOW to enter a specific industry or market. Either way, both questions follow the same structure in the beginning. The market entry framework used in this example covers a company characteristics analysis, industry analysis and an entry-mode vehicle selection.

Company characteristics

You want to start off with some general questions about your client’s company. Why is it that Company Z is thinking about entering a different market? Do they have excess money to invest? Is Company Z’s current business stagnating? Or are they simply looking for new ways to grow? By asking this question you will find out more about the motives of your client. Secondly, you could ask when entering a new market is considered successful? Is there a certain market share the company wants to conquer or are they already satisfied when their business would make a profit in the first year? Answers to these questions would make it easier for you to quantify the case objectives in terms of market share (% of the total market size) or profits (expected revenues−costs). If needed you could also ask about the company’s current business (e.g. core capabilities, product mix, revenue stream, customer segment). It would for example help if Company Z’s current customers have overlap with the customers it would be targeting when entering a new industry. Don’t take too long for these kind of questions, but do make sure that you have a good impression of what your client looks like.

Market and industry analysis

This is the main part of your analysis. Here you want to determine how much potential the industry your client is thinking about entering actually has. You could start off with the market size. In some case interviews, they will ask you to estimate the size of the market yourself. This could be done by multiplying the amount of customers in a certain area by the average price of a product × the average amount of products that are being bought a year by a single customer. In addition, it is very important to ask about trends: has the market size changed over time? In what life cycle stage is the industry at the moment: emerging, mature, declining? You don’t want to enter an industry that is already declining massively. Next you could ask about the major players in the industry: the competition. Is the industry consolidated (a few large players) or fragmented (many small players)? And how are all players differentiated from each other? Don’t forget to also take into account potential new entrants, substitute products, entry barriers and supplier power. A great framework for this part of the analysis is  Porter’s Five Forces . Consequently, you could look at the customers. What are their needs and how loyal to existing brands are they? Is Company Z able to capture some of these clients from rivals in that industry? This is also where you need to think about positioning Company Z in the current competitive landscape. As extra option you could also do a quick  PESTEL Analysis  to determine what macro-environmental factors could affect your business in the long term.

Figure 1: Porter’s Five Forces

Entry-mode vehicle

In case both the company analysis and the industry analysis above turn out to be favorable for a market entry, your client might want to know HOW it should enter the focal market. There are multiple ways in which a company can enter a new market. During an interview it is often enough to mention the three most common vehicles: starting from scratch yourself ( greenfield investment ), forming a strategic alliance or joint venture  with a local player, or acquiring a competitor in that specific industry. It is important to know the pros and cons of each vehicle compared to the other options. An acquisition for instance is a faster market entry vehicle than starting from scratch yourself. A drawback of an acquisition however is the integration process and possible cultural clashes. A strategic alliance would sound like a great middle ground alternative. However, even with strategic alliances there can be cultural clashes and so called learning races. For a more exhaustive list with pros and cons of organic growth, acquisitions and alliances, you could look here  and  here . Other entry-mode strategies you could consider are licensing , exporting or franchising . In order to decide between these options and foreign direct investment (greenfields, acquisitions and joint ventures), you could use the Eclectic Paradigm  (or OLI Paradigm).

Figure 2: OLI Paradigm/Eclectic Paradigm

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Mastering Case Study Frameworks: A Comprehensive Guide for Success

Note: Don’t forget to read and work through our Masterguide to Case Frameworks if you’re still struggling with your profitability case frameworks after reading this article.

Table of Contents

Case study frameworks are crucial tools for management consultants and aspiring candidates in the consulting industry. They provide a structure to analyze and solve complex business problems, helping consultants deliver valuable insights and recommendations to their clients. In this comprehensive guide, we dive into the most essential case study frameworks, their applications, and how to effectively use them in your consulting practice.

Introduction to Case Study Frameworks

Case study frameworks are structured approaches used to analyze and solve business problems during consulting case interviews and client engagements. These frameworks help consultants break down complex problems into smaller, manageable components, allowing for a systematic and efficient approach to problem-solving.

Consultants Create Frameworks to Run Teams

Remember, frameworks are not just to be memorized. They are your tailored, objective-driven, approach to solving a problem.

Because frameworks are simply the modules that a consulting team would assign to their team members.

When creating your frameworks, think to yourself, can my buckets be assigned successfully to Team Member 1, Team Member 2, and Team Members 3 & 4?

The Importance of Case Study Frameworks

Case study frameworks are valuable for several reasons:

• They provide a structured way to approach business problems, making it easier to identify the root cause and develop actionable solutions.
• They help consultants effectively communicate their thought process, findings, and recommendations to clients and interviewers.
• They enable consultants to leverage their experience and knowledge by applying proven methodologies to new business situations.

Flexibility and Adaptability in Applying Case Frameworks

It’s essential to understand that case frameworks are not one-size-fits-all solutions . Instead, they should be viewed as flexible tools that can be adapted, combined, and customized to fit the specific problem at hand. In other words, the best case frameworks are those that can be tailored to address the unique challenges and requirements of each client and situation.

In the following sections, we will discuss some of the most commonly used case study frameworks in management consulting. We will cover their key components, when to use them, and how to apply them effectively.

Profitability Case Frameworks

The profitability framework is a fundamental case study framework that focuses on understanding the drivers of a company’s financial performance. It is most applicable in cases where the client’s primary objective is to improve financial performance, either by increasing revenue, reducing costs, or both.

If you want to read even more on profitability and how to approach it for any case type , take a look at our article here .

Do Not Regurgitate Revenue Cost

As we mentioned above, it is absolutely critical that you stay flexible and adaptable with your frameworks. This is especially true for Profitability. Gone are the days of a generic Revenue Cost framework.

Consultants do not solve real life projects with Revenue and Cost and nor should you in your cases.

Adapt and Adjust Based on the Case

The most important thing to remember about a profitability framework is that it needs to be adjusted to the case . Bucket options include (but are not limited to):

• Competition
• Store (breakdown)
• External/Macro
• Revenue (in context/tailored)
• Cost (in context/tailored)
• Value chain

How do you decide which buckets to use? Well, it depends on the case! For example, if the prompt tells you there are 3 products our company has and we just launched a 4th, of course you need a products bucket. If we are McDonalds (international, different models worldwide), of course you need to break it down by geography.

Listen to how I break this down to a candidate of mine here:

As an example, say we have a food delivery company that has previously focused on topline revenue growth, has negative margins, and now needs to become profitable. How would you create a framework for this? (Please don’t say revenue cost!)

Here’s one option (of multiple):

This probably looks different to what you expected. But it’s also why my candidates consistently get interviewer feedback saying their frameworking is the best they have ever seen.

Remember, every profitability case should have a slightly different set of buckets, based on the problem you are solving.

Again, for a deeper breakdown, check out our article here .

Applying the Profitability Framework

To apply the profitability framework effectively, follow these steps:

•   Identify the relevant components (revenue, costs) and drivers (price, quantity, variable costs, fixed costs) that are most pertinent to the client’s problem.
•   Analyze the current performance of these components and drivers, comparing them against industry benchmarks and competitors.
•   Identify opportunities for improvement and develop recommendations to address these opportunities, considering both short-term and long-term implications.

When identify which areas to pursue (across profit, margin, revenu, and cost), you want to tackle any of the following:

• What’s the biggest? – This refers to the biggest piece of the revenue/expenditure pie, which has the potential to significantly impact the end result.
• What’s changing the most? – Rapid changes in a revenue/cost segment could be a significant driver and potentially fixable.
• What’s the easiest to answer or eliminate? – Opt for quick wins. These are typically yes/no types of questions that can eliminate many other factors.
• What’s the most different? – Look for differences between companies, business units, products, and geographies. Differences often equate to opportunities.
• What’s the most likely? – This is self-explanatory and refers to the most probable source of revenue/cost issues

Market Entry Case Frameworks

The market entry framework is used to evaluate the attractiveness and feasibility of entering a new market or launching a new product. It helps consultants assess the potential opportunities and risks associated with market entry and develop a comprehensive strategy for successful market penetration.

Key Components of the Market Entry Framework

Just like with profitability, you have to tailor your framework to the case prompt.

One option for a market entry framework is as follows:

•   Market Analysis : Assessing the size, growth, and dynamics of the target market.
•   Competitive Landscape : Evaluating the competitive forces and players in the market.
•   Internal Capabilities : Analyzing the company’s strengths, weaknesses, and resources to enter the market.
•   Entry Strategy : Determining the best approach to enter the market, such as organic growth, joint ventures, or acquisitions.

But, the above is just one option. We could also have a Market, Company/Competition, and Financials framework. However, ideally we would articulate it as follows:

Now, remember that all of the above is just for the question Should We Enter This Market?

A different market entry question might be “Our Client has determined that x market is attractive and wants to enter. They have brought us to figure out if we should”. This needs a different framework.

Or, the question might be “Our client has decided to enter x market. How should we enter?” The above frameworks don’t work here!

As a final example, perhaps the case tells us “We are evaluating between 3 markets to enter. Which one should we enter?” Again, new framework needed.

To understand how to tackle these more unconventional market entry cases, please take a look at our 360 degree course .

The Porter's Five Forces Case Framework

Porter’s Five Forces is a widely recognized case study framework developed by Harvard Business School professor Michael E. Porter. It helps consultants analyze the competitive forces shaping an industry and understand the attractiveness and profitability of a market.

Key Components of Porter’s Five Forces Framework

The Porter’s Five Forces framework consists of five main components:

•   Threat of New Entrants : The ease with which new competitors can enter the market and challenge established players.
•   Bargaining Power of Suppliers : The ability of suppliers to influence the terms and conditions of their business relationships with companies in the industry.
•   Bargaining Power of Buyers : The ability of customers to influence the terms and conditions of their business relationships with companies in the industry.
•   Threat of Substitute Products or Services : The likelihood that customers will switch to alternative products or services that fulfill the same need.
•   Rivalry Among Existing Competitors : The intensity of competition among companies within the industry.

When to Use Porter’s Five Forces Framework

The Porter’s Five Forces framework is most applicable in cases where the client is considering entering a new market, launching a new product, or assessing the competitive landscape of an industry.

Applying Porter’s Five Forces Framework

To apply the Porter’s Five Forces framework effectively, follow these steps:

•   Analyze each of the five forces, considering their impact on the industry’s attractiveness and profitability.
•   Identify the key drivers and trends influencing each force and assess their potential implications for the client.
•   Develop recommendations to address the opportunities and challenges posed by the competitive forces, considering both short-term and long-term strategies.

The SWOT Analysis Framework

The SWOT analysis is a widely recognized case study framework that helps consultants evaluate a company’s internal strengths and weaknesses as well as external opportunities and threats. This framework enables consultants to identify key strategic issues and develop recommendations to address them.

Key Components of the SWOT Analysis Framework

The SWOT analysis framework consists of four main components:

•   Strengths : The internal capabilities and resources that give the company a competitive advantage.
•   Weaknesses : The internal limitations and vulnerabilities that hinder the company’s performance.
•   Opportunities : The external factors that the company can capitalize on to improve its performance.
•   Threats : The external factors that pose risks to the company’s performance and success.

When to Use the SWOT Analysis Framework

The SWOT analysis framework is most applicable in cases where the client is seeking to improve its overall performance or address specific strategic issues.

Applying the SWOT Analysis Framework

To apply the SWOT analysis framework effectively, follow these steps:

•   Identify the company’s key strengths and weaknesses, considering factors such as resources, capabilities, and market position.
•   Analyze the external environment, identifying opportunities and threats that may impact the company’s performance.
•   Develop recommendations to leverage the company’s strengths, address weaknesses, capitalize on opportunities, and mitigate threats.

Growth Case Frameworks

The growth strategy framework focuses on identifying and evaluating potential avenues for a company to achieve revenue and market share growth. This framework helps consultants develop a strategic roadmap for the client’s expansion and growth.

Key Components of the Growth Strategy Case Framework

One growth strategy case framework can be broken down into four main components:

•   Market Penetration : Increasing sales of existing products or services in current markets.
•   Market Development : Entering new markets with existing products or services.
•   Product Development : Introducing new products or services in existing markets.
•   Diversification : Expanding into new markets with new products or services.

Remember, however, just like with profitability and market entry cases, you need to listen to the prompt and adjust this framework accordingly to the prompt and company context. Different growth prompts will have different case frameworks.

When to Use the Growth Strategy Case Framework

The growth strategy framework is most applicable in cases where the client is seeking to expand its business, increase market share, or explore new growth opportunities.

Applying the Growth Strategy Framework

To apply the growth strategy framework effectively, follow these steps:

•   Assess the company’s current performance, market position, and growth potential.
•   Identify potential growth opportunities across the four growth strategy components, considering factors such as market attractiveness, competitive landscape, and internal capabilities.
•   Evaluate the feasibility and risks associated with each growth opportunity, taking into account factors such as market entry barriers, resource requirements, and potential synergies.
•   Develop a strategic roadmap for the client’s growth, prioritizing the most attractive and feasible growth opportunities.

Tips for Successfully Applying Case Study Frameworks

To effectively apply case study frameworks in your consulting practice, consider the following tips:

•   Don’t rely solely on case frameworks : Remember that frameworks are just one tool in your problem-solving toolkit. Use them as a starting point, but be prepared to adapt and customize them to fit the specific problem at hand.
•   Listen carefully to the client’s needs : Understand the client’s objectives, priorities, and constraints before selecting and applying a framework. Tailor your approach to address the client’s unique needs and circumstances.
•   Stay flexible and adaptable : Be prepared to adjust your approach as new information emerges or as the client’s needs evolve. Be open to combining and customizing frameworks to develop a tailored solution.
•   Communicate your thought process clearly : Clearly explain the rationale behind your chosen framework, the steps you took to apply it, and the insights and recommendations that emerged from your analysis. This will help ensure that your client and interviewers understand and appreciate your approach.

Enroll in our 360 course . This comprehensive course focuses heavily on building up your frameworking optimally. To get a better understanding of how to create killer case frameworks, start with our master article on case frameworks.

Mastering case study frameworks is crucial for success in the consulting industry. By understanding the key components, applications, and best practices for applying these frameworks, you can develop a strong foundation for effective problem-solving and strategic thinking.

Remember to stay flexible, adaptable, and customer-centric in your approach, and always be prepared to learn and grow as you refine your skills in applying case study frameworks. By doing so, you can unlock unparalleled insights and deliver exceptional value to your clients and interviewers alike.

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What Are Marketing Frameworks?

Every marketer knows that a great marketing strategy begins as a plan. You do a lot of hard work identifying your target audience, where they spend time, how to reach them, and communicating to them that they need or want your product or service. A marketing framework takes all this hard work you did and puts it together in one visual place so that you can share it with others on your team or at your company and make it much easier to execute. There are several different types of marketing frameworks. We will tell you about some popular marketing framework examples and how to choose the best one for your business.

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What is a Marketing Framework?

You wouldn’t start building a house without a blueprint, would you? Well, your market framework is the blueprint of your marketing strategy. So, before you sit down to create your marketing strategy , consider your marketing framework. The marketing framework is the visual representation of how marketing gets done in your business. It details how you will execute your marketing plan and deliver your content to your audience. Sometimes, it is called the marketing strategy framework.

The Benefits of a Marketing Strategy Framework

A marketing framework is meant to help your marketing team function at its highest level. There are several benefits to creating a marketing framework, including:

• Improving the overall marketing strategy, which in turn benefits the growth and success of your company
• Keeping you and your team focused and on the same page
• Creating a home for all the templates, guides, tools, and assets that make your marketing strategy and everyone on your team might need to access
• Establishes approved verbiage used by the organization throughout packaging, social media, newsletters, etc.
• Allows you to clearly communicate and designate roles and responsibilities for various team members, or transfer people between roles if necessary
• Saves time by making expectations clear and avoiding redos or errors

Different Types of Marketing Framework Models

Over time, many marketing frameworks models have been developed. The following are a few of the most common and popular examples of marketing frameworks:

The 7Ps Marketing Mix

Perhaps the widely used marketing framework is the 7Ps Marketing Mix . It is popular because it helps you analyze and optimize every facet of your business to ensure success, whether you are just starting a new company or simply want to evaluate your current process and optimize campaign performance. 

The 7Ps include:

• Product : What you are selling.
• Price : How much the product costs.
• Place : Where the product is sold.
• Promotion : How you share your product with your audience.
• People : Who is involved in the production, promotion, and distribution of your product.
• Process : How the product is delivered to the customer.
• Physical Evidence : How you prove to customers that your business exists.

The STP Marketing Model

In STP, S stands for segmentation, which is dividing your audience into different sections; T stands for targeting, which is determining who will want or need your product the most; and positioning, how you make that product the most appealing to your target audience.

The STP model is a top-down approach that focuses on getting highly personalized and applicable information to an extremely targeted audience. If your product is fairly specific, this might be the right marketing framework example for you to use.

Porter’s Five Forces

Many marketing frameworks focus mostly on the product or service and/or the target customers, but Porter’s Five Forces is a different type of model . It looks mostly at the outside factors that could affect the success of your business, including:

• Supplier Power: This includes how many other suppliers exist, what differentiates them from yours, and the cost of their product compared to yours.
• Buyer Power: This is the customer’s ability to influence decisions made by the company.
• Threat of Substitution: This compares your product to the others on the market.
• Threat of New Entry: What barriers might you face entering the market?
• Competitive Rivalry: What are some other outside factors that might affect how your product performs compared to the competition?

Pirate Metrics (AARRR)

This is one of the more modern marketing frameworks and works especially well for e-commerce businesses. (Don’t worry, there is no need to set sail!) Pirate Metrics was developed by serial startup founder Dave McClure and shows you how customers travel along their buying journeys and which areas might use some improvement. Let’s break down AARRR:

• Acquisition : This is how leads find you. You might use website visitor tracking to determine how your audience is arriving at your site. Is it via search engines, Instagram ads , a blog, an influencer , etc.?
• Activation : This is the step the lead took once they arrived at your website. It might be giving you their email address in exchange for a discount on their first purchase, signing up for an account, etc.
• Retention : Once that lead leaves your site, do they return? How often?
• Revenue : How do you earn money from your clients? You can review data like conversion rates, shopping cart abandonment or size, and the customer lifetime value.
• Referral : When customers are happy with your product or service, they will tell other people, and this means more customers. This is great for business because it means you have to spend less money attracting new customers via marketing campaigns.

How to Choose the Best Marketing Model for Your Business

There is no one “best” marketing framework that will fit every business. The right marketing framework for your business depends on you, the marketer, your target audience, your product or service, and other factors, including:

• Your business goals
• The role of marketing within your company
• How you define and measure the success of your marketing campaigns
• The capabilities of your marketing department
• Areas where marketing is most necessary in your company

The best marketing framework for your company might be one of the examples mentioned above, a combination of them all, one we didn’t include here, or even one you create yourself! The important thing is finding a marketing framework that fits your business.

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CHIPS for America

About CHIPS for America

Semiconductors, or chips, are tiny electronic devices that are integral to America’s economic and national security. These devices power tools as simple as a light switch and as complex as a fighter jet or a smartphone. Semiconductors power our consumer electronics, automobiles, data centers, critical infrastructure, and virtually all military systems. They are also essential building blocks of the technologies that will shape our future, including artificial intelligence, biotechnology, and clean energy.

While the United States remains a global leader in semiconductor design and research and development, it has fallen behind in manufacturing and now accounts for only about 10 percent of global commercial production. Today, none of the most advanced logic and memory chips—the chips that power PCs, smartphones, and supercomputers—are manufactured at commercial scale in the United States. In addition, many elements of the semiconductor supply chain are geographically concentrated, leaving them vulnerable to disruption and endangering the global economy and U.S. national security.

That’s why President Biden signed the bipartisan CHIPS and Science Act of 2022 into law. The law provides the Department of Commerce with $50 billion for a suite of programs to strengthen and revitalize the U.S. position in semiconductor research, development, and manufacturing—while also investing in American workers. CHIPS for America encompasses two offices responsible for implementing the law: The CHIPS Research and Development Office is investing $11 billion into developing a robust domestic R&D ecosystem, while the CHIPS Program Office is dedicating $39 billion to provide incentives for investment in facilities and equipment in the United States. Learn more about CHIPS for America from this video message from the Secretary of Commerce . 

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Biden-Harris Administration Announces Preliminary Terms with Rocket Lab to Expand Production of Compound Semiconductors that Power Spacecrafts and Satellites

Biden-harris administration announces preliminary terms with absolics to support development of glass substrate technology for semiconductor advanced packaging, biden-harris administration announces preliminary terms with polar semiconductor to establish an independent american foundry, chips for america announces $285 million funding opportunity for a digital twin and semiconductor chips manufacturing usa institute.

Marla Dowell Recognized as a Distinguished Executive with 2023 Presidential Rank Award

For general inquiries about CHIPS for America, contact askchips [at] chips.gov (askchips[at]chips[dot]gov) .

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To request a meeting with a CHIPS staff member or an appearance at an event, visit https://askchips.chips.gov .

The CHIPS Incentives Program Portal can be found at https://applications.chips.gov .

The state of AI in 2023: Generative AI’s breakout year

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The latest annual McKinsey Global Survey  on the current state of AI confirms the explosive growth of generative AI (gen AI) tools . Less than a year after many of these tools debuted, one-third of our survey respondents say their organizations are using gen AI regularly in at least one business function. Amid recent advances, AI has risen from a topic relegated to tech employees to a focus of company leaders: nearly one-quarter of surveyed C-suite executives say they are personally using gen AI tools for work, and more than one-quarter of respondents from companies using AI say gen AI is already on their boards’ agendas. What’s more, 40 percent of respondents say their organizations will increase their investment in AI overall because of advances in gen AI. The findings show that these are still early days for managing gen AI–related risks, with less than half of respondents saying their organizations are mitigating even the risk they consider most relevant: inaccuracy.

The organizations that have already embedded AI capabilities have been the first to explore gen AI’s potential, and those seeing the most value from more traditional AI capabilities—a group we call AI high performers—are already outpacing others in their adoption of gen AI tools. 1 We define AI high performers as organizations that, according to respondents, attribute at least 20 percent of their EBIT to AI adoption.

The expected business disruption from gen AI is significant, and respondents predict meaningful changes to their workforces. They anticipate workforce cuts in certain areas and large reskilling efforts to address shifting talent needs. Yet while the use of gen AI might spur the adoption of other AI tools, we see few meaningful increases in organizations’ adoption of these technologies. The percent of organizations adopting any AI tools has held steady since 2022, and adoption remains concentrated within a small number of business functions.

Table of Contents

• It’s early days still, but use of gen AI is already widespread
• Leading companies are already ahead with gen AI
• AI-related talent needs shift, and AI’s workforce effects are expected to be substantial
• With all eyes on gen AI, AI adoption and impact remain steady

About the research

1. it’s early days still, but use of gen ai is already widespread.

The findings from the survey—which was in the field in mid-April 2023—show that, despite gen AI’s nascent public availability, experimentation with the tools  is already relatively common, and respondents expect the new capabilities to transform their industries. Gen AI has captured interest across the business population: individuals across regions, industries, and seniority levels are using gen AI for work and outside of work. Seventy-nine percent of all respondents say they’ve had at least some exposure to gen AI, either for work or outside of work, and 22 percent say they are regularly using it in their own work. While reported use is quite similar across seniority levels, it is highest among respondents working in the technology sector and those in North America.

Organizations, too, are now commonly using gen AI. One-third of all respondents say their organizations are already regularly using generative AI in at least one function—meaning that 60 percent of organizations with reported AI adoption are using gen AI. What’s more, 40 percent of those reporting AI adoption at their organizations say their companies expect to invest more in AI overall thanks to generative AI, and 28 percent say generative AI use is already on their board’s agenda. The most commonly reported business functions using these newer tools are the same as those in which AI use is most common overall: marketing and sales, product and service development, and service operations, such as customer care and back-office support. This suggests that organizations are pursuing these new tools where the most value is. In our previous research , these three areas, along with software engineering, showed the potential to deliver about 75 percent of the total annual value from generative AI use cases.

In these early days, expectations for gen AI’s impact are high : three-quarters of all respondents expect gen AI to cause significant or disruptive change in the nature of their industry’s competition in the next three years. Survey respondents working in the technology and financial-services industries are the most likely to expect disruptive change from gen AI. Our previous research shows  that, while all industries are indeed likely to see some degree of disruption, the level of impact is likely to vary. 2 “ The economic potential of generative AI: The next productivity frontier ,” McKinsey, June 14, 2023. Industries relying most heavily on knowledge work are likely to see more disruption—and potentially reap more value. While our estimates suggest that tech companies, unsurprisingly, are poised to see the highest impact from gen AI—adding value equivalent to as much as 9 percent of global industry revenue—knowledge-based industries such as banking (up to 5 percent), pharmaceuticals and medical products (also up to 5 percent), and education (up to 4 percent) could experience significant effects as well. By contrast, manufacturing-based industries, such as aerospace, automotives, and advanced electronics, could experience less disruptive effects. This stands in contrast to the impact of previous technology waves that affected manufacturing the most and is due to gen AI’s strengths in language-based activities, as opposed to those requiring physical labor.

Responses show many organizations not yet addressing potential risks from gen AI

According to the survey, few companies seem fully prepared for the widespread use of gen AI—or the business risks these tools may bring. Just 21 percent of respondents reporting AI adoption say their organizations have established policies governing employees’ use of gen AI technologies in their work. And when we asked specifically about the risks of adopting gen AI, few respondents say their companies are mitigating the most commonly cited risk with gen AI: inaccuracy. Respondents cite inaccuracy more frequently than both cybersecurity and regulatory compliance, which were the most common risks from AI overall in previous surveys. Just 32 percent say they’re mitigating inaccuracy, a smaller percentage than the 38 percent who say they mitigate cybersecurity risks. Interestingly, this figure is significantly lower than the percentage of respondents who reported mitigating AI-related cybersecurity last year (51 percent). Overall, much as we’ve seen in previous years, most respondents say their organizations are not addressing AI-related risks.

2. Leading companies are already ahead with gen AI

The survey results show that AI high performers—that is, organizations where respondents say at least 20 percent of EBIT in 2022 was attributable to AI use—are going all in on artificial intelligence, both with gen AI and more traditional AI capabilities. These organizations that achieve significant value from AI are already using gen AI in more business functions than other organizations do, especially in product and service development and risk and supply chain management. When looking at all AI capabilities—including more traditional machine learning capabilities, robotic process automation, and chatbots—AI high performers also are much more likely than others to use AI in product and service development, for uses such as product-development-cycle optimization, adding new features to existing products, and creating new AI-based products. These organizations also are using AI more often than other organizations in risk modeling and for uses within HR such as performance management and organization design and workforce deployment optimization.

AI high performers are much more likely than others to use AI in product and service development.

Another difference from their peers: high performers’ gen AI efforts are less oriented toward cost reduction, which is a top priority at other organizations. Respondents from AI high performers are twice as likely as others to say their organizations’ top objective for gen AI is to create entirely new businesses or sources of revenue—and they’re most likely to cite the increase in the value of existing offerings through new AI-based features.

As we’ve seen in previous years , these high-performing organizations invest much more than others in AI: respondents from AI high performers are more than five times more likely than others to say they spend more than 20 percent of their digital budgets on AI. They also use AI capabilities more broadly throughout the organization. Respondents from high performers are much more likely than others to say that their organizations have adopted AI in four or more business functions and that they have embedded a higher number of AI capabilities. For example, respondents from high performers more often report embedding knowledge graphs in at least one product or business function process, in addition to gen AI and related natural-language capabilities.

While AI high performers are not immune to the challenges of capturing value from AI, the results suggest that the difficulties they face reflect their relative AI maturity, while others struggle with the more foundational, strategic elements of AI adoption. Respondents at AI high performers most often point to models and tools, such as monitoring model performance in production and retraining models as needed over time, as their top challenge. By comparison, other respondents cite strategy issues, such as setting a clearly defined AI vision that is linked with business value or finding sufficient resources.

The findings offer further evidence that even high performers haven’t mastered best practices regarding AI adoption, such as machine-learning-operations (MLOps) approaches, though they are much more likely than others to do so. For example, just 35 percent of respondents at AI high performers report that where possible, their organizations assemble existing components, rather than reinvent them, but that’s a much larger share than the 19 percent of respondents from other organizations who report that practice.

Many specialized MLOps technologies and practices  may be needed to adopt some of the more transformative uses cases that gen AI applications can deliver—and do so as safely as possible. Live-model operations is one such area, where monitoring systems and setting up instant alerts to enable rapid issue resolution can keep gen AI systems in check. High performers stand out in this respect but have room to grow: one-quarter of respondents from these organizations say their entire system is monitored and equipped with instant alerts, compared with just 12 percent of other respondents.

3. AI-related talent needs shift, and AI’s workforce effects are expected to be substantial

Our latest survey results show changes in the roles that organizations are filling to support their AI ambitions. In the past year, organizations using AI most often hired data engineers, machine learning engineers, and Al data scientists—all roles that respondents commonly reported hiring in the previous survey. But a much smaller share of respondents report hiring AI-related-software engineers—the most-hired role last year—than in the previous survey (28 percent in the latest survey, down from 39 percent). Roles in prompt engineering have recently emerged, as the need for that skill set rises alongside gen AI adoption, with 7 percent of respondents whose organizations have adopted AI reporting those hires in the past year.

The findings suggest that hiring for AI-related roles remains a challenge but has become somewhat easier over the past year, which could reflect the spate of layoffs at technology companies from late 2022 through the first half of 2023. Smaller shares of respondents than in the previous survey report difficulty hiring for roles such as AI data scientists, data engineers, and data-visualization specialists, though responses suggest that hiring machine learning engineers and AI product owners remains as much of a challenge as in the previous year.

Looking ahead to the next three years, respondents predict that the adoption of AI will reshape many roles in the workforce. Generally, they expect more employees to be reskilled than to be separated. Nearly four in ten respondents reporting AI adoption expect more than 20 percent of their companies’ workforces will be reskilled, whereas 8 percent of respondents say the size of their workforces will decrease by more than 20 percent.

Looking specifically at gen AI’s predicted impact, service operations is the only function in which most respondents expect to see a decrease in workforce size at their organizations. This finding generally aligns with what our recent research  suggests: while the emergence of gen AI increased our estimate of the percentage of worker activities that could be automated (60 to 70 percent, up from 50 percent), this doesn’t necessarily translate into the automation of an entire role.

AI high performers are expected to conduct much higher levels of reskilling than other companies are. Respondents at these organizations are over three times more likely than others to say their organizations will reskill more than 30 percent of their workforces over the next three years as a result of AI adoption.

4. With all eyes on gen AI, AI adoption and impact remain steady

While the use of gen AI tools is spreading rapidly, the survey data doesn’t show that these newer tools are propelling organizations’ overall AI adoption. The share of organizations that have adopted AI overall remains steady, at least for the moment, with 55 percent of respondents reporting that their organizations have adopted AI. Less than a third of respondents continue to say that their organizations have adopted AI in more than one business function, suggesting that AI use remains limited in scope. Product and service development and service operations continue to be the two business functions in which respondents most often report AI adoption, as was true in the previous four surveys. And overall, just 23 percent of respondents say at least 5 percent of their organizations’ EBIT last year was attributable to their use of AI—essentially flat with the previous survey—suggesting there is much more room to capture value.

Organizations continue to see returns in the business areas in which they are using AI, and they plan to increase investment in the years ahead. We see a majority of respondents reporting AI-related revenue increases within each business function using AI. And looking ahead, more than two-thirds expect their organizations to increase their AI investment over the next three years.

The online survey was in the field April 11 to 21, 2023, and garnered responses from 1,684 participants representing the full range of regions, industries, company sizes, functional specialties, and tenures. Of those respondents, 913 said their organizations had adopted AI in at least one function and were asked questions about their organizations’ AI use. To adjust for differences in response rates, the data are weighted by the contribution of each respondent’s nation to global GDP.

The survey content and analysis were developed by Michael Chui , a partner at the McKinsey Global Institute and a partner in McKinsey’s Bay Area office, where Lareina Yee is a senior partner; Bryce Hall , an associate partner in the Washington, DC, office; and senior partners Alex Singla and Alexander Sukharevsky , global leaders of QuantumBlack, AI by McKinsey, based in the Chicago and London offices, respectively.

They wish to thank Shivani Gupta, Abhisek Jena, Begum Ortaoglu, Barr Seitz, and Li Zhang for their contributions to this work.

This article was edited by Heather Hanselman, an editor in the Atlanta office.

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