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Note: Thank you to Mimi Zou for bringing this analysis framework to my attention.
The concept of MECE (mutually exclusive and collectively exhaustive) is one of the hallmarks of problem solving at McKinsey (The McKinsey Way by Ethan M. Rasiel). McKinsey consultants use the MECE framework when trying to crystallise and structure the issues relating to a business problem. An explanation of the MECE framework follows.
MECE refers to the idea that, firstly, when analysing a business problem issues should be divided into groups so that each grouping is separate and distinct without any overlap (i.e. mutually exclusive). Overlap is a problem because it means muddled thinking and will result in confusion. Secondly, all groups taken together should comprehensively represent all of the issues related to the problem at hand (i.e. all of the issues taken together should be collectively exhaustive).
The MECE framework is useful for the purpose of analysis because it helps avoid the problem of double counting and reduces the risk of overlooking information. Double counting is avoided because all issues are grouped so that they are separate and distinct from one another. The risk of overlooking information is reduced because the MECE framework encourages careful consideration of the issues, and requires all of the issues relating to the problem to be listed.
According to Ethan Rasiel, a major issues list should contain no less than two and no more than five issues, with three being the ideal number. If you are unable to categorise the problem you are considering in between 2 to 5 issues, there is always the option of creating a category of “other issues”, although this is most effective when used as a sub-heading for presentation purposes.
The easiest way to graphically represent a problem that is being analysed using the MECE framework is to draw a tree diagram. The diagram as a whole represents the problem at hand; each branch stemming from the starting node of the tree represents a major issue that needs to be considered; each branch stemming from one of these major issues represents a sub-issue that needs to be considered; and so on.
McKinsey’s MECE framework can be applied to a lot of different business problems. For example, The Coca-Cola Company might use the MECE tree diagram to help them locate the source of declining profitability:
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3 Responses
James Cox
14|Jun|2008 1Cool new ads and good little article…
Ash
25|Jun|2008 2Hi Tom,
Would you say this tool can be readily used for solving case interview problems? or would you say this is a more comprehensive tool, requiring careful consideration?
Keep up the great work
Ash
Tom Spencer
25|Jun|2008 3Ash,
My unconsidered answer is that the MECE framework can be used in case interviews but is also quite a comprehensive tool.
Hopefully, you will have considered all of the different types of case interview questions that you might be asked before you set foot in the interview. During this preparation time, think about how you might use the MECE framework to structure your ideas for each different type of problem (e.g. questions on declining profitability, expanding into new markets etc.).
I should have provided a worked case example in this post, and will try to do so soonish.
In the meantime, can anyone give us a worked case example using the MECE framework?
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