Babson

CASENO~10

Revised Dec. 30, 1997

Babson College
F.W. Olin Graduate School of Business
Note on Case Analysis and Classroom Discussion by Professor Larry Isaacson Introduction I. CASE REALITY II. LEARNING FROM CASES III. CASE PREPARATION IV. PRESENTING YOUR VIEWS INTRODUCTION

Many management courses employ cases. Some use them as examples of good (or bad) practice; some as "history lessons;" some as the basis for exercises in applying specific techniques. At Babson most management instructors use them as opportunities for you to place yourself -- as a manager -- in situations like the ones you will face in the your future jobs.

In these job situations you will have to make the best decisions you can, using the analytic and managerial tools available, despite incomplete information and faced with considerable uncertainty. To prepare for this, your task as a student is to immerse yourself in each case in the same way you would immerse yourself in a similar problem in your job. In this role you will do everything you can to creatively solve the problem and create a realistic plan for implementing your solution. Then, to come to class and share your ideas with others -- presenting your ideas, learning from theirs -- thereby developing the analytic and presentation skills you will need to be an effective manager. The purpose of this note is to provide four sets of "tips" that may assist you in learning how to prepare for classroom discussion of such cases and participate effectively in the class.

1. CASE REALITY

Cases are real. They are descriptions of real events, and they are intended to be studied and discussed as representations of reality. That is their charm and their value as teaching vehicles. But that reality is tempered by an understanding of certain case conventions. Specifically:

Cases are generally not intended either as examples of good management practice or as examples of mistakes. Rather, they place you in the role of the responsible manager who must make a decision. It is up to you to analyze management’s actions and plans to date, determine which you believe are sound and worth continuing and which you want to change. Finally, you must create action plans to implement your decisions.

In a case, if the casewriter states a fact about the industry, or presents actual data from industry or company sources, you should believe that the data are "correct". The casewriter actually found them and you may assume that he or she accurately reported what they found. But you must still question whether the data are relevant or useful. Often they are not.

When the casewriter says that "Mr. Jones believed.." or that "Miss Smith proposed..", it means exactly that: They believed or proposed. But that does not mean their beliefs were correct or their proposals sound. It is your task to question their beliefs and proposals. When you have reason to believe your own views are better informed, you should create your own analysis and action program, based on your insights. Most of the time you will find that you can improve on even the best proposal or plan presented in the case.

In short, cases are a lot like the reality of everyday managerial life. Each day managers are confronted with a lot of data and opinions that sometimes turn out to be wrong, or incomplete, or inadequate. It is your task to determine which data to act upon and when to revise, or reject. Or, you may want to seek further information before a decision can properly be made. Working on cases helps improve these key skills.

II. LEARNING FROM CASES

Doing a good job of learning from cases requires three specific actions your part:

Thorough Preparation. Effective class discussion requires that every participant is thoroughly familiar with the key facts of the case, has identified and considered options, made appropriate calculations and analyses, reached a conclusion, and is ready to share this understanding and conclusion -- including support for the recommendation -- with the class as a whole.

Enthusiastic, Risk-Taking Participation. In class, usually you will rapidly review the situation, establish known alternatives and then creatively identify additional ways to proceed, before seeking consensus on one or more potentially viable solutions. Effective participation in this process requires that each of you take responsibility for presenting analyses, listening to others, and helping evaluate and modify the ideas that are presented, until conclusions are reached. This requires taking an engaged, assertive role in the class.

At times this also involves taking risks. Others may disagree with your views. You may find you have made errors in your analysis.. That's what the class is for -- to permit you to try out new approaches -- to see what works -- and to use feedback from others to modify your first attempt and try again. Our task, as teachers and discussion leaders, is to assist you in trying out your ideas and to evaluate you principally on how well you learn from trying -- not on how "right" you are the first time.

Periodic Rethinking/Integration. Although part of your learning will occur as you work on each case, the greatest benefit of the case method comes from going back and thinking about a group of cases, seeing how they illustrate and illuminate a process or a way of thinking. By analyzing the subtle ways in which a process or analytic technique is modified to meet the needs of a variety of situations, you will acquire the subtle skill of understanding how to adapt your problem solving to the demands of new situations.

Critical to this learning process is the recognition that all management decision-making, while based in part on analysis, is also based on interpretation, logic and questioning. And on judgments about people and their capabilities. Thus, your task is not simply to take so-called "facts" as given -- but to determine for yourself the difference between "true facts" and misguided opinions, assumptions and no-longer applicable conventions.. To do so, you will practice evaluating data, analyses, and organizations, revising your evaluations, and converting these insights into action plans.

Developing the judgment to do this is the hard part of management -- and the hard part of case discussion -- but it is also the most important. It is learned only by repeated experience, in case studies and in business, by periodically going back and reviewing and integrating what you have learned. Therefore, part of your task is to remember each case and to periodically mentally re-visit it, thereby getting the most out of your intensive preparation.

Our role in this process is to help you identify the subtle similarities and differences, and the key processes, that are most helpful. Periodically we will explore with you how these processes have been applied to a series of situations, to help you integrate what you are learning.

III. CASE PREPARATION

The most significant determinants of whether you will get the most out of a case or a case course are the quantity and quality of your case preparation and that of your classmates. If you are "well-prepared," you will feel more competent to volunteer to start the class off by providing a 5 to 10 minute review of what is happening in the case, what problems or issues arise in the situation, and what alternatives you see for resolving these issues. You may even be prepared to offer a recommendation based on your analysis. Your faculty expects you to come to class prepared to do this. So it is important to think about what constitutes "good preparation." In my view there are four key elements:

Knowing the Key Facts. This sounds obvious, but it isn't. After all, which facts are "key?" Well, my working definition is that key facts are those that will significantly influence future action. Specifically, key facts usually include:

What business are we in? What do we do in that business? Are we a major player or a newcomer? What are our major strengths and weaknesses? How are we doing?
How competitive is this business? What are the major trends and outside influences affecting it?
Is this an important decision? Why does it matter? What is at stake? For whom?
What are the economics of this decision? Are costs fixed or variable? Will changes in sales have a major impact on profits? How?

Identifying the Issue. A case "issue" is a management question that requires an answer that will lead to action. The key facts help define this issue. Often a general form of the issue is stated in the first or last paragraph of the case -- or in the case assignment. Sometimes you have to search for it. Virtually always, even if you do find a general statement of the issue quickly and easily, an important part of your problem-solving process will be to keep on refining your statement of the issue to make it more and more precise.

We will practice this a lot because, the more precisely you can state the issue, the more readily you can spot key facts, create alternative solutions, evaluate alternatives, and recommend action. In short, good issue identification turns out to be far more critical than it at first may seem.

Evaluating Alternatives. Cases usually suggest one or two alternatives -- even if they are only partially defined. Often you can come up with better ones if you think about it for awhile. So don't fall into the trap of just looking at what the people in the case have already proposed. In any complex situation there are many action possibilities. You can't fully assess all of them. So start by picking a few representative ones -- that represent quite different possibilities -- and use these representative proposals to zero in on the range of solutions that is most promising. Then, at a second stage of analysis, you can further refine your recommendation within this range.

One of the most helpful techniques for assessing alternatives is to "model" the decision. That is, try to draw a picture of the decision and how it should be made. For example:

Will it be based just on profit? If so, you may need to build a breakeven or contribution chart, or a pro-forma profit and loss statement. You may calculate NPV or IRR – techniques you will soon learn in your other courses if you have not encountered them already.
Will it depend on a market study? If so, you can outline the design of such a study and build an exhibit showing how results will relate to your proposal for action.
Will it depend most on weighing several qualitative factors? How? You can build a matric of costs and benefits, pros and cons, or factors and weights to show how they combine to determine the action that should be taken.

Recommending action. If you have done all the things spelled out above, there usually won't be much preparation time left. But it does pay to consider how you will explain your view of the situation, analyses, and recommendations to others. The trick in presenting your ideas to the class is to focus on what really matters and to cut out everything else. This means trying to:

Capsule the key facts that shape the opportunity and issue in a simple explanation or diagram.
Suggest the range of alternatives and focus on the most representative ones.
Show how the decision should be made, and apply this model or process to the key alternatives.
Prove that your recommended alternative is not only theoretically best, but also practical and can be implemented.

Many students find that it is very helpful to use a study group as part of the process. An effective study group will require that you come prepared by having read the case and begun to analyze it, state your views, listen to others, and work together to refine your ideas and create additional analyses. Then you can seek consensus and go to class knowing that at least some other students in your group have views similar to your own.

IV. PRESENTING YOUR VIEWS

There are several ways in which class discussion of cases provides opportunities for you to present your views. This provides important opportunities for you because as a manager you must be able to inform and convince others to share your view of a situation or recommendation. The case classroom is an excellent place to learn to do so.

In each class, as part of the general discussion, you will have opportunities to define the situation, suggest and apply analytic techniques, and recommend action. This plays out differently as the class progresses:

Naturally the person who starts the class discussion has the greatest opportunity to shape the class. If you go first you may be expected to take 5 to 10 minutes to lay out key aspects of the whole situation, suggest alternatives and analyses, and structure a direction for the class. Sometimes this initial comment will take the class all the way to a recommendation. More often it will set the stage and open up possibilities and analytic directions. If this opening is well structured and clearly presented, the class will progress more rapidly.

Early in each case discussion, faculty often try to work with one or two student participants to build a clear, succinct presentation of the situation. If we ask questions at this point, it is not to question what you are saying, but to encourage you to express your ideas with greater clarity, or to encourage you to provide more support for the model or course of action you are proposing.

As the class progress there will be times when you will want to propose actions or analyses that are quite different from those being proposed by others. Give those who are advocating an idea a chance to finish. Wait a moment until their ideas have been well explored. Then you can feel free to introduce a new idea and take an extra few minutes to carefully present your own new approach, analysis or recommendation. Take the time to make sure that your idea or proposal is well understood.

Asking for clarification can also have a significant positive impact on the class discussion. Don’t hesitate in the mistaken feeling that you might be "holding up the class." Quite the contrary. If something is not clear to you, others usually have the same question.

Switching paths, or seeking clarification, may mean taking a moment to overcome the existing momentum and create new movement. But it’s worth it. Part of your job as a "manager-in-training" is to sense this necessity and to shape your presentation of your questions and ideas to be forceful enough to create this movement. Don’t hesitate!

Near the end of the class discussion there are usually opportunities to revise what has been said earlier and to sum up and create a reasonable consensus position. This too is good practice for your future role as a manager.

By taking advantage of these different opportunities, you can use solid preparation and class participation to speed up your own learning and sharpen your skills as a future manager. * * *

Everything that goes on in the case classroom is designed to help you learn and internalize this process. We therefore encourage you to periodically reflect on what you are doing as a participant, why and how you are doing it, and how it serves your goal of becoming a better manager. Stop periodically to think about your own case participation and you will speed-up and enhance your own learning.

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