Easy NAV

There are over 500 consulting case study examples in the Case Library – this is a Profitability case in the McKinsey firm style.

Prompt

EasyNAV is a multi-national third-party fund accounting company based in New York. Asset managers, such as Fidelity or other smaller investment shops, often outsource the calculation of their daily fund prices to third-parties such as EasyNAV. These fund prices, called Net Asset Values, or “NAVs,” represent the per-share price of the fund, which then becomes published to the general public, e.g., in the Wall Street Journal.

Given the high financial stakes, asset managers require EasyNAV to be both highly accurate and timely in their NAV calculations. This is still a highly manual process due to the number of data sources required to collect this information and inconsistency in data formats delivered to EasyNAV.

Although business growth has been strong over the last five years, EasyNAV has seen its costs rising more quickly than its revenues. At the current trajectory, costs will exceed revenues within the next decade, and something must be done.

What are the causes of EasyNAV’s rising costs, and what can be done to reduce them?

Overview

In this McKinsey case study interview, the client has been experiencing growing costs, and has brought you in to advise it on reducing costs. Your job is to dive into the profitability to determine the root causes of the issue and, ultimately, provide the client with a recommendation on how to reduce costs.

Use the Profitability Framework to solve this case problem. Beware of only using the basic framework though. The best case interview candidates blend frameworks and their own business acuity to create custom structures that best fit the business situation in the case.

This case has several math diagrams for you to interpret as you run through the case. This is a tough case – the qualitative difficulty is 4 out of 4. The case will prep you for a final round at McKinsey.

McKinsey Interview Pointers

What does McKinsey look for in its case interview candidates? The ability to problem-solve and clearly communicate your process and recommendations.

The firm isn’t as concerned with your actual answer to the case, but in how you got to the answer. It’s all about the process.

In this case study, emphasize your communication (is it clear) and your overall poise/polish (can you see yourself delivering the final presentation to the CEO of a F500 company?).

For some quality out-loud practice with an expert coach, book an hour today.

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