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Case Interview Fundamentals: Lesson 22 [Drill: Philippines Service Exports] — Transcript

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0:00A lot of candidates are super scared of
0:02public sector cases, and for good
0:04reason. I mean, it's much harder to
0:07structure, you're not
0:08used to it, and each public sector case
0:12is different from the other. I mean,
0:14it's completely different to get a
0:15sanitation case than a case on education
0:19uh versus a case on uh some sort of
0:23health policy, for example, uh
0:27increasing taxation for smokers.
0:30And because each public sector case is
0:32so different, people get scared of them.
0:34That's normal, but you shouldn't be
0:36scared. If you've gone through the
0:39context uh breakdown technique already,
0:42uh
0:43you you have noticed that having a
0:46public sector framework or building a
0:49public sector framework isn't that
0:52different than adapting a business
0:55situation framework or a a three C's
0:58framework to your specific case. And
1:00with that technique, you can structure
1:02any case. Also, some people are scared
1:06or uncertain if they're going to find
1:09the right issues, right? You've gone to
1:11business school, or maybe you you
1:13didn't, but you have an interest in
1:15business. So, you you may have a pretty
1:18good business sense, but what about
1:21{quote} public sector sense? How how can
1:24you develop that?
1:26And if you've gone through the context
1:29breakdown technique video, you've also
1:31noticed that it's actually pretty simple
1:35to come up with uh insightful issues.
1:39You just figure out what is the role of
1:42each part of the system within the
1:44system. So, the role of each category,
1:47of each bucket within the whole system,
1:50and you ask questions. What, who, why
1:55about uh the role of that part of the
1:58system. Now, in this drill, we're going
2:01to apply all of that into practice. So,
2:04the drill is about the government of
2:06Philippines trying to stimulate its
2:09service exports industry. So, it's kind
2:12of business-related. It's related to the
2:14economy of a country, but it's still
2:17public sector because it's not a
2:19business trying to maximize profits.
2:22It's a government trying to do something
2:25with their country's economy.
2:28As with every framework drill,
2:30if you're in skill-building mode, if
2:32you're learning how to create these
2:34structures, even if you know how to
2:37create good structures or business
2:39cases, but you're not so sure about
2:42public sector cases, then take 10 to 15
2:45minutes to structure or even longer if
2:47you feel the need for it.
2:49It pays off because you're going to
2:50learn a lot more. Now, if you already
2:53know how to do this, and
2:56very few of you are going to be in this
2:58category because I I know of no other
3:01resource that teaches you how to create
3:03your own frameworks for public sector
3:05cases. But, if you're if you already
3:07know how to do it, if you're in time
3:10improving mode, then take two to three
3:12minutes to structure, so you practice
3:14your timing for a more
3:17realistic scenario. 99% of you guys are
3:22going to be in skill-building mode, and
3:23that's fine.
3:25That's how you learn how That's how you
3:26develop your skills. So, let's jump
3:29right into the case question.
3:31Your client is the government of the
3:33Philippines, and they have noticed a
3:36trend of small and large businesses from
3:39English-speaking developed countries
3:41hiring Filipinos as virtual assistants
3:44for jobs such as web design,
3:46presentation design, so PowerPoint
3:48design,
3:49administrative tasks,
3:51and even for more complex tasks such as
3:53data analysis, social media marketing,
3:56and programming.
3:58They've talked to workers and employers
4:00in this booming industry, and they have
4:02found that these firms from other
4:05countries are doing this. They're hiring
4:06Filipinos because of their excellent
4:09English, their good skills, hard and
4:11soft skills, and their incredible work
4:14ethic. And also because of their
4:16relatively low salary. So, you can hire
4:19a Filipino data analyst or web designer
4:24or virtual assistant in general for much
4:27lower wages than you can in
4:29English-speaking developed countries
4:32such as the US, Canada, Australia,
4:35uh the UK, and so on.
4:38The workers love it because they get
4:40flexible work and they're paid more than
4:43the average
4:44uh for domestic jobs. So, due to these
4:47factors, the government wants to
4:49stimulate this new sector and have the
4:52Philippines become a global hub for
4:54outsourcing services.
4:57For this task, they've asked for your
4:59help. What factors would you analyze to
5:02help them stimulate this booming sector?
5:05So, in other words, how should the
5:07government of Philippines stimulate its
5:10service exports industry? So, they're
5:13exporting services in such a way.
5:17So, let me just do uh
5:19uh
5:20simple comments here. There's a lot of
5:21context in this case question. This is
5:24typical of McKinsey, but it can happen
5:26in other firms as well. Uh it happens
5:29more often at McKinsey. Other firms,
5:31they more often give a simpler scenario
5:34with fewer factors, less information so
5:36that you can ask about it, but it
5:38happens in every consulting firm.
5:40There's two things to have in mind if
5:42this happens.
5:44The first one is use the richness of
5:46information provided in the question.
5:48Your interviewer expects that and these
5:50things are there for a reason as
5:52everything in a case interview. And this
5:54reason is to see if you can connect the
5:57dots. So, your interviewer is actively
5:59looking
6:01to whether or not you're using the
6:03information they gave you or not.
6:06The second point to have in mind is you
6:08can ask clarification questions even
6:11though the question is that rich in
6:13information. But, they better be really
6:16good clarification questions. I won't
6:18ask any in this case because it seems
6:20like the problem is well defined to me.
6:23But, if you were to ask questions, just
6:26two examples of good ones is first
6:29is there a specific metric that the
6:31government is interested such as job
6:33creation or raising income or increased
6:36GDP? A second clarification question
6:40that you could ask is for example, is
6:42the government looking for short-term
6:45stimulation or more into the long-term
6:48to shift a bit of the country's economy
6:50into this type of work?
6:52So, just to give you an idea of what
6:54good clarification questions look like.
6:56But, the point is you'll not get away
6:59asking a mindless clarification
7:02questions because there's so much
7:03information already. So, if you're
7:05asking things that are not that
7:07relevant, the interviewer is going to be
7:08like, "Whoa, guy. I just
7:11I just gave you this much information
7:13and you're asking me
7:15this question?
7:17Doesn't make sense. Okay? So, now it's
7:19time for you to pause the video and
7:23structure your case. 10 to 15 minutes if
7:26you're in skill building mode, that's
7:28probably the mode you're in. And then
7:30come back to the video and watch my own
7:32answer.
7:33Now, here's my answer to the question.
7:35And one thing to notice here, which is
7:37pretty pretty interesting, is the
7:39interviewer could have asked me, "Well,
7:41how would you help them grow this or
7:45what would you do in their place? And
7:47that would have made things a lot
7:49harder. But instead, what they did was
7:52they asked me what factors would I want
7:54to analyze. And by asking these specific
7:58questions that are with this specific
8:00phrasing, which is pretty common at
8:02McKinsey mainly, but can happen in other
8:05firms as well, they're making my job a
8:08lot easier.
8:09If they had asked me how would I help
8:11them or what what should they do, then I
8:15would need to create a step-by-step
8:18plan. But instead, they're just asking
8:21me what factors would I analyze. So, I
8:24don't have to create a step-by-step
8:25plan, which makes things a lot easier.
8:28And actually, it's how most projects
8:31start. Uh you start by looking into
8:34things, and then you go on to
8:37restructure the problem and find a
8:39solution. So, let's see what factors
8:42would I analyze. I'd analyze six main
8:44categories. The first is the demand. Who
8:48are and what kinds of services is the
8:50demand looking for? Second factor, the
8:53workforce in Philippines. What kinds of
8:55jobs can our people do and also what
8:58kinds of jobs do they want to do?
9:01Third, the types of jobs. So, that's
9:03kind of how the demand interacts with
9:05the workforce. What are the types of
9:08jobs that exist and what are the
9:10advantages and disadvantages of each one
9:13and how can we capture
9:15the best types of jobs to our country?
9:18The fourth are what I'm calling the
9:20brokers, which are the companies or
9:22whoever matches the demand with the
9:25workforce. I imagine that these
9:28international companies are not calling
9:31random Filipinos to to
9:34to offer them work. They're probably
9:36going through some broker, which could
9:38be a marketplace,
9:40some kind of a an internet website that
9:42lists these people, or maybe a company
9:44that hires these people, and so on.
9:47Uh fifth, the infrastructure, so
9:50everything that surrounds these workers
9:52and let them work.
9:54And then finally, the government,
9:56because we as a government have a role
9:58here and can we fulfill that role?
10:01So, let's start with the demand first.
10:04The first thing I would look into the
10:05demand is from which countries and which
10:08industries are these companies
10:11that are currently hiring our people.
10:14And I just want to get a lay of the land
10:16to see who are these people? Are they
10:19Are these multinational companies? Are
10:22these small companies? In which
10:24proportion for each? And from which
10:26industries? Are these software companies
10:29or maybe, I don't know, engineering
10:32companies? We need to to to take a look
10:35at that just to see who's
10:37giving work to our people uh now,
10:40because these are probably the most
10:42interested people. Second, what are they
10:45looking for when they outsource these
10:47kinds of services to a country like the
10:49Philippines? So, one hypothesis here is
10:52they they just want to cut costs and uh
10:56and that's it, which wouldn't be a
10:58really good hypothesis because as we
11:02offer more of these services and our
11:03people
11:05start earning more, then there won't be
11:07a lot of upside after that. But maybe,
11:10maybe they're looking for other things
11:12as well. For example, maybe they're
11:13looking for people to work on some tasks
11:16overnight.
11:17So, their business runs more smoothly.
11:20So, because the Philippines is in a
11:22different time zone from most of the
11:25western world, this could be the case.
11:27Or maybe they're looking for uh
11:30sure, cost savings, but also skilled
11:33people who can speak really good English
11:36and who are really friendly. And this
11:38might give us a competitive advantage
11:40over other countries that might not have
11:43such a good English-speaking population
11:46and so on. So, these are some hypotheses
11:47that I'd look for here. But the point
11:49is, what are the specific things these
11:52companies are looking for when they hire
11:54our services or the services of our
11:57people?
11:58Third, what types of jobs that these
12:01uh companies have, what kinds of tasks
12:05can be outsourced versus what they're
12:08outsourcing now? So, my hypothesis here
12:12is that maybe they are outsourcing basic
12:16tasks mainly,
12:18but there's a lot of other tasks that
12:20they could be outsourcing if we had the
12:23people with the skills or if they knew
12:26that we had the people with the skills.
12:27So, maybe they could be outsourcing uh
12:30software engineering. And it seems like
12:33they're doing a bit of that, but maybe
12:34they could be doing more. Maybe
12:37uh they could be outsourcing not just
12:40design web design, but also design in
12:43general. So, branding, for example. And
12:47I want to know just to see if there's uh
12:49room for growth in the future. And then
12:52fourth, what are their concerns and
12:54obstacles when doing this? For the
12:56companies that are interested in
12:58outsourcing uh work to the Philippines,
13:01but that are not currently doing that,
13:04why are they not doing that? And the
13:06hypothesis here is that we as a
13:08government can clear some of these
13:11obstacles, some of these concerns, and
13:13increase this market. Now, let's look
13:16into the workforce. There's a few things
13:18that I would look here. First, how
13:20skilled is the workforce or our
13:23population in the types of jobs these
13:25companies are outsourcing? So, for
13:27example, when they hire a web designer
13:30from the Philippines
13:32uh or maybe even a personal assistant,
13:35are these people really skilled and
13:37uh competitive in terms of skill with
13:40people in their own country, in their
13:43developed countries, or are they just a
13:45cheap alternative? If they're just a
13:48cheap alternative, maybe we want to
13:50change that.
13:51Second, how well do they communicate in
13:53terms of language and cultural
13:55differences? So, in the first bullet
13:57point, I was looking at hard skills. Uh
14:00now I'm looking at communication,
14:02culture, understanding of cultural
14:04differences, and more into the soft
14:06skill side. And third,
14:09are these people are are Filipinos
14:12interested in working in this type of
14:14job? And if so, why or why not?
14:17And the idea here is just to understand,
14:20we as a government, are we stimulating
14:22an industry that uh has the population
14:25interested in working in this? My
14:27hypothesis is that yes, they're
14:28interested. I mean, they're doing it
14:30already without any stimulus. And also,
14:33it seems like the job pays more, gives
14:36them more flexibility, perhaps uh
14:39lets them in in
14:42working uh more
14:45uh advanced work or more interesting
14:48work. But we want to check that with the
14:50population, with the people who are
14:51working these jobs. Maybe they're just
14:53doing it because they have no
14:54alternative, and they very much prefer
14:57working in other industries. So, it
15:00would make sense to stimulate these
15:01other industries.
15:03Now, onto types of jobs, a few issues.
15:06First, what are the types of jobs that
15:09are outsourced to other countries and
15:11not to the Philippines and why? One that
15:13comes to mind here is a lot of IT stuff
15:17is outsourced to India. Maybe it's not
15:19to the Philippines, and I'd like to
15:21understand why not uh if we could grab
15:24some of that as well.
15:26Uh second, how can the Philippines move
15:29up in the value chain into higher paying
15:30jobs?
15:32So, I've talked a little bit about that
15:34earlier, but the idea here is to kind of
15:37create a ladder for the jobs uh that we
15:40have. So, maybe we're doing a bit of
15:43coding, but not yet software design and
15:46not yet user experience
15:49uh design for software or higher levels
15:52of coding and I'd like to know what are
15:54the next steps
15:56to have Filipinos earn a
15:59larger wage because I'd like to simulate
16:03those better.
16:05Third, what are the new industries that
16:07are coming up that we can specialize
16:09early as a country? So, I remember a few
16:12years ago where when social media
16:14started uh
16:16becoming a big deal and there was this
16:19new job which was social media marketers
16:22and these people
16:25I mean, it was kind of a new job. No one
16:27took it seriously at first and now it's
16:29a huge industry. It's a job that employs
16:32a lot of people and whoever became good
16:35at that at first probably has a big
16:38advantage now. So, I'm trying to look a
16:39bit ahead to see what are the new
16:42industries that are coming up that we
16:44can specialize. So, maybe AI
16:47I don't know, maybe something blockchain
16:49related. The I don't know if it makes
16:51sense. But
16:53the idea is to be ahead of the curve so
16:56that we can get better paying jobs and
16:58maybe even become a global reference in
17:00these types of work of jobs or work.
17:04Now, onto the brokers. As I've
17:05mentioned, they're businesses and
17:07marketplaces are potentially. I want to
17:09know what are the main ones that connect
17:12companies to the Filipino workforce and
17:14I want to just get an understanding of
17:16who they are, why they do it, and maybe
17:18talk to these people to understand how
17:23attractive this market is, and
17:26how what are the main difficulties.
17:28These people probably have a lot of
17:29information about the demand and about
17:32the workforce
17:34that is information earned on the field.
17:36So, I'd like to talk to some of these
17:38brokers.
17:40And here I'm looking at marketplaces
17:42online, probably, maybe offline as well,
17:45but also businesses that might employ
17:48Filipinos
17:49to sell their work to companies abroad.
17:54And then the second thing here is how
17:56can we stimulate more and better
17:58brokers? If we are to stimulate this
18:01market, these guys could be a key
18:03because how is the demand supposed to
18:06find the workforce? How are the workers
18:08supposed to find the demand? And I guess
18:12that the answer is with brokers.
18:15We could think of having a government
18:18broker, but I think the private sector
18:20would probably do this better.
18:22Fifth bucket, infrastructure. I see
18:24three types of infrastructure. First,
18:27telecom internet because these guys are
18:30going to be doing remote work. Second,
18:33training. So, what are the schools,
18:36private or public, and what are the
18:38resources that the country private or
18:41public sector
18:43offer to Filipinos to learn these
18:45skills? Social media marketing, coding,
18:48being a good personal assistant. I mean,
18:51there are personal assistants that are
18:52paid a lot of money because they're able
18:54to organize and schedule an executive's
18:59work and schedule very efficiently and
19:02effectively. So, we we want our our
19:04population to be good at doing these
19:06types of jobs. And finally,
19:09money transferring. How easy it is to
19:11money to transfer money from foreign
19:13companies to Filipinos?
19:16This could be a hurdle because if if it
19:18takes a lot of time for a Filipino to
19:21get paid or if they're suffering huge
19:25fees from banks or whoever's doing this
19:28or if it's too hard for companies to to
19:32exchange money, we want to make it as as
19:34easy as possible.
19:36And finally, as the government, we have
19:39a role to do this project and try to
19:42make it better for the other five
19:45buckets. Let's put it that way. But
19:47also, we want to
19:49taxation for this type of job to be not
19:52too high and not too complex.
19:55Probably as simple as possible. I can
19:56see that it could be really complex and
19:59the hypothesis here is that it's a
20:01service export.
20:03It's hard for the government to control
20:05it unless the government's prepared to
20:08do it. And if it's something new, maybe
20:10the government doesn't know how to
20:12handle it, so they make it complex, so
20:14they they get paid. But we don't want to
20:18put barriers into this new industry
20:21because of complexity.
20:23And the second thing is the bureaucracy.
20:26Is it making this work informal or
20:29unfeasible? And the idea here is
20:32if the government or the work ministry
20:36or something like that, if they don't
20:38have a framework to to think about this
20:42type of work, then maybe it's hard for
20:45people to be legal doing this type of
20:47work or be doing this type of work
20:50in a way that gives them job security,
20:54maybe social benefits or social
20:56security, and so on. And we want to make
20:58this type of work as
21:02clean and legal, I'd say,
21:06as well seen by authorities as possible
21:09if we want to stimulate this industry.
21:12So, these are the main factors that I'd
21:14look for,
21:16uh, that I'd analyze in order to help
21:19the government of Philippines stimulate
21:21the service exports industry and I'd
21:24start with a study of demand and of the
21:28workforce.
21:29But, I think the easiest way to get all
21:31this information is going through to the
21:34brokers. So, I want to to study the
21:36demands and the workforce because these
21:38are the two main parties here.
21:41Uh,
21:42so the I'd ask the questions within
21:45those buckets, but if I were to
21:48uh, actually
21:50get these answers the most efficient
21:53way,
21:54I'd probably spend a couple days talking
21:56to the main brokers, to the main
21:58businesses and marketplaces that connect
22:01the two sides because
22:02my hunch is that they have a lot of good
22:04information.
22:05But, I'd start with those two buckets
22:07first just to see if there's a match
22:09between demand and workforce.
22:12Now, let's debrief this case for a bit.
22:14It was pretty long framework. It is a
22:16complicated complicated complex problem.
22:20Uh, so let's try to understand
22:22the decision makers, the interfaces
22:24considered following our
22:27step-by-step approach to build our own
22:29frameworks as
22:31we've discussed in the context breakdown
22:34technique video and also the function in
22:37the system. So, if you're able to
22:39understand how I got to those buckets as
22:42decision makers, as interfaces, and if
22:44you understand uh,
22:47what's their function in the system so
22:49you can understand why I asked those
22:51specific questions,
22:53then you're going to understand how I
22:54made this framework and this is the main
22:57topic of this debrief. After that, I'm
22:59going to do a business sense
23:01quote-unquote because it's not business
23:04uh debrief so I can talk through some of
23:06the main issues in this case. So,
23:09this is an economic system, right? We're
23:11talking about an economic relationship
23:14between the Philippines and the rest of
23:16the world in a specific industry. So, we
23:19need to think about supply and demand as
23:21with always all economic systems. So,
23:25this
23:26makes sense for the two first buckets.
23:28Demand, which is the demand of course,
23:30and the workforce, which is the supply
23:32of work. And what about their function
23:35in the system? The function of the
23:38demand in this system is to generate
23:40quality work for Filipinos. And you can
23:42define quality in a variety of ways,
23:45but I think the simplest is work that
23:48pays well.
23:49This is why these people are working for
23:51these international companies. And the
23:54function of the workforce is to do these
23:56jobs with skill and motivation. So,
23:59everything I've asked about the demand
24:01is
24:03uh some in some way regarding their
24:06ability to generate quality work for
24:09Filipinos. And everything I've asked
24:11about the workforce is in some way
24:13regarding to whether they can do these
24:15jobs with skill and whether they're
24:17motivated to do these jobs.
24:20Now, as with many supply demand
24:23relationships, there are things in the
24:25middle. There are things that help the
24:28demand meet supply and the supply meet
24:30demand. And the two things here are
24:34types of jobs
24:36and brokers. So, types of jobs is the
24:40kind of conceptual interface between
24:43demand and workforce because they
24:45determine what these people are doing
24:48and to whom.
24:49And they determine the wages and the
24:51skill needed. So, I need to understand
24:54what type of what types of jobs are
24:56these people doing to these companies?
24:59And what types of jobs do we aspire them
25:02to do? Right? So,
25:04if we just take it for granted that
25:06they're just going to be virtual
25:08assistants, I mean, that's fine. That's
25:11a
25:12a fine job to have, but maybe we want
25:15them to be
25:16better paid in the future. And then, to
25:19do that, uh they're going to need
25:21different skills so that they can do
25:23different types of jobs. So, we need to
25:25understand that. Also, we want them to
25:28do jobs that are here to stay.
25:31So, uh I didn't speak of that, but it
25:33would be a good
25:35uh hypothesis to raise. What if a lot of
25:37these jobs are
25:39uh automatized by AI in the future?
25:43Wouldn't we be creating an economy
25:46that's uh fragile? Maybe we want to do
25:49types of work that is harder to be
25:52automatized. Maybe design work, maybe uh
25:56programming uh instead of scheduling,
26:00which is something that maybe Google
26:03uh automatizes in some way in the near
26:05future. So, I didn't raise that issue,
26:07that hypothesis, and probably I should
26:09have. It's a really good one.
26:11And then, the other interface between
26:14the man and supplier, the brokers. They
26:16match demand with the workforce. They
26:18can be real brokers.
26:20So, actual marketplaces,
26:23uh places where the demand meets the
26:25supply directly. Or they can be
26:27companies that hire the Filipinos.
26:30And the international companies just
26:33hire the services of these companies.
26:36And they take on the demand risk. So,
26:38they're employing Filipinos
26:41uh with stable employment. And if demand
26:44surges, they make some money. If demand
26:46drops, maybe they make less money or
26:49even uh have a loss for a few months or
26:51years.
26:52Uh so, they take on the demand risk. So,
26:55I've called these guys brokers because
26:57they match demand with the workforce.
26:59And we need to understand how they do
27:01it, and they probably have an important
27:03role in the system. Otherwise, they can
27:05be theoretical demand
27:09and theoretical supply, but if they
27:11never meet, then it's not going to
27:13happen. It's going to be all latent, and
27:15we're going to be losing an opportunity
27:17here. Now, the two other things that
27:19I've considered are infrastructure and
27:22government. And these are kind of
27:24structural interfaces. They're not
27:26direct interfaces between the demand and
27:29supply. They're things around the system
27:32that makes the system work. Call it the
27:36lubricant oil in a machine, if you will.
27:40So,
27:41the oil doesn't make the machine work.
27:44It enables the machine to work. So, the
27:47infrastructure is there to give
27:48Filipinos the tools that they need to
27:51work. And these tools can be real tools
27:55such as internet, bandwidth, telecom
28:00services, and and
28:02uh payment systems, but they can also be
28:05kind of metaphorical tools such as
28:08training. But they need these things to
28:10to do the work. Other And if these
28:12things are not in place, maybe they want
28:14to work, maybe they have the potential
28:16skills to do that, but they can't do it.
28:19And the other one is the government.
28:21First function of the government is to
28:23help kick-start the system,
28:26which is why they're hiring us. So, I
28:27didn't talk [clears throat] much about
28:29that. This is all the other things that
28:31they need to understand to know how to
28:33proceed. But the other function of the
28:35government is to allow Filipinos to have
28:38job security in this type of work. So,
28:41they know that they can do this, and
28:43they will be able to provide for their
28:45families.
28:46Now, one thing I didn't mention here is
28:49competition.
28:51And there are two points I want to make
28:53about this. The first one is it could
28:55work. I mean, other countries are
28:57outsourcing hubs such as India.
29:00And maybe we want to study these other
29:04countries
29:05uh because we want to know how do they
29:08get demand for
29:10exporting services
29:12through through the service industry of
29:14their citizens.
29:16And
29:17are we in competition with them? Can we
29:19do something about it? Well, you could
29:21use a bucket like that. It's nothing
29:23wrong using it. But our goal is not to
29:26force fit the three C's.
29:29Our goal is to think from first
29:31principles and to understand what types
29:33of decision makers and interfaces do we
29:36need to consider. What is their function
29:38in the system? And thus, what types of
29:42questions do we need to ask to help
29:44these clients, the government of the
29:46Philippines,
29:48to to achieve their goal.
29:51And
29:53I personally don't think competition is
29:56that relevant of a bucket.
29:59Uh and the reason is
30:02let's say India exports a lot of
30:04services and perhaps even some of the
30:07same types of services, presentation
30:09design, web design, uh coding.
30:12What can we do about it as a government?
30:15We can't
30:16tell them not to do it. We can't
30:20directly
30:21uh
30:22improve our own product or services a
30:25company can
30:27uh
30:27because we're a government. All we can
30:29do is to give the tools of our to our
30:31citizens
30:33to improve to the brokers or the
30:35businesses that uh connect these
30:39people with the demand. All we can do is
30:41to enable our our country to be
30:44competitive.
30:45We can't do much about other countries.
30:48So, I can see
30:51uh how this category would be relevant.
30:54But, if you found interesting,
30:58insightful questions, and you chose to
31:01do it, that's fine. Just
31:04try to think for yourself if you
31:08used the competition bucket. If you
31:10really had interesting things to think
31:13about it, and if you had actual
31:16interesting questions, or if you were
31:17just force-feeding the three Cs, and
31:20just working via inertia,
31:23just doing what you're used to do in a
31:26business case, because this is not a
31:28business case.
31:30So, think for yourself if you if you
31:32actually thought from first principles
31:34of or if you were just using something
31:36you're used to use.
31:38Now, to our business sense debrief, and
31:41I put business sense in in
31:43air quotes because it's not business,
31:45it's public sector, although it is
31:48economics.
31:50Uh
31:51but, anyway, uh let's talk about the
31:53issues in this case.
31:55There are four issues that I call
31:58required issues, which means if you
32:01didn't talk about them in some way,
32:04shape, or form, then
32:07you made a mistake, and your interviewer
32:09is going to notice that. And the first
32:12one is you need to talk about what is
32:15the demand looking for, including the
32:18criteria for outsourcing. How do they
32:20choose if they outsource or not, and how
32:24do they choose to where? Is it just
32:27cost? Is it uh
32:30do uh English language skills? Is it
32:33hard skills? Is it friendliness?
32:37Uh
32:39I don't know.
32:40Taxation,
32:42bureaucracy.
32:44All the things that I've talked about in
32:46the framework that are related to
32:49what is the demand looking for? If you
32:51don't know what is demand looking for,
32:53you can't do anything as a government or
32:56even as a business, you can't know what
32:59to do unless you understand why
33:02uh these companies are outsourcing to
33:04the Philippines.
33:06Second required issue is latent demand.
33:09So,
33:10uh I gave some clues in the case
33:12question and the thing here is this new
33:15industry is uh emerging on its own. It's
33:20just happening. The government didn't do
33:22anything about it. So, it's probably not
33:25well explored yet.
33:28Not because the government didn't do
33:29anything about it because but because
33:31it's so new and everyone's trying to
33:33make sense of it. So, there's probably a
33:36lot of potential demands that didn't uh
33:40become real demands yet. Maybe because
33:43the
33:44the the the clients
33:47and the companies abroad have concerns
33:49and objections. Maybe because our
33:51population isn't trained into something
33:54really important for these companies.
33:57Uh and we could train them.
34:00Uh maybe because
34:03uh
34:04just one industry abroad has uh found
34:08out that
34:09they can do this, maybe the software
34:11industry, but other industries that
34:13could benefit from it are not aware yet.
34:16So, you need to talk about latent demand
34:18because that's what's going to make this
34:20uh
34:21this industry develop in the country.
34:24The development of the industry needs to
34:26come from somewhere and this is the
34:29potential demands that is not used yet.
34:32Or in other words, latent demand.
34:35Third required issue is the types of
34:37jobs, and this is
34:39first because it's important. You need
34:41to know what these guys are working on,
34:43but second, it's mentioned in the case
34:45question. I've mentioned a ton of types
34:48of jobs that these guys are doing, and I
34:51kind of categorize them into simpler
34:53jobs and more sophisticated jobs, social
34:56media marketing, uh programming, and so
34:59on.
35:01And I was giving clues here. I was
35:03giving clues that you need to look into
35:05that because it's important.
35:09You need to look into the types of jobs
35:10that I mentioned and the types of jobs
35:12that I didn't mention, and maybe that
35:15that they're not doing yet, but they
35:16could be doing. And also,
35:19I gave clues that there are jobs that
35:21are more advanced than others, which is
35:24important because
35:26uh it's implied that they pay more as
35:28well, which is nice from a government
35:32perspective because they want their
35:33citizens to earn more
35:35uh so that the economy can develop.
35:38Finally,
35:40hard and soft skills versus job
35:42requirements. So, as we talk about types
35:45of jobs, latent demand, what is the
35:47demand looking for, these things are
35:50uh interrelated in
35:52this last bullet point, which is what
35:55are the hard and soft skills that our
35:58citizens have?
36:00And what are the job requirements for
36:02type for each type of job, for each type
36:04of client? Uh
36:07because if we can match those, then we
36:10can develop this, and this could be one
36:12key for
36:14uh the case.
36:15Uh maybe the answer of to how should the
36:18government of Philippines stimulate its
36:20service exports industry is
36:22by matching their citizens' hard and
36:25soft skills versus the job requirements
36:28of the types of jobs that they want
36:29their citizens to be working at. And
36:31maybe it's not. I don't know. You need
36:33You need data to
36:35confirm or
36:37disconfirm that, but this is a really
36:39strong hypothesis.
36:41Now, there are two what I call standout
36:44issues. So, issues that make you stand
36:47out to your interviewer. And there are
36:48probably more. As in every case, I can't
36:50predict uh every insightful
36:54uh thing that can come up, but I can
36:56give examples of those so you can see
36:58what these look like.
37:00One of them is how to get better paying
37:03work in the future. And as a bonus, new
37:06job trends. So,
37:09what I mean by this is
37:11uh
37:12you as a government can be thinking
37:15about how to get work for your citizens
37:20through this new uh service experts
37:23industry.
37:24But, you can also think about how to use
37:26this as a platform to develop the skills
37:29of your citizens to become much better.
37:32So, just to to give you an analogy of
37:35what I mean by this is maybe two decades
37:39ago, 20 years ago, China was known
37:42for manufacturing
37:44uh poor quality, really cheap products.
37:48>> [snorts]
37:48>> And I'm making a generalization here, so
37:51any of you guys who are Chinese
37:54uh don't get offended by this, but it's
37:55just how it was back then, at least in
37:58many people's minds.
38:00And China could have
38:02uh
38:03kept manufacturing this and grown their
38:06economy through more cheap stuff.
38:09Uh but, what they chose to do instead
38:12was to use the money that came in as
38:15they were selling a lot of stuff to the
38:18rest of the world to develop their
38:20skills, their technology, their
38:22factories, their workforce, so that they
38:25could build better stuff. And nowadays,
38:28they're leaders in many many
38:30technologies.
38:32So, uh
38:33just to give one example, why is the
38:36iPhone manufactured in China? One reason
38:39is it's cheaper than in the US. Another
38:41reason is a lot of the suppliers who
38:43have the technology are in China. So,
38:46for example,
38:47the leader in uh small cameras for
38:50smartphones is in China, and it's a
38:52Chinese company, and
38:55as far as I know, no company in the West
38:58knows how to do smartphone cameras, the
39:01small cameras that go in your iPhone, as
39:04well as they do. So, same thing here.
39:06How can the Filipinos, they they might
39:08start doing
39:10uh low-wage job,
39:13but they could use this to develop the
39:16skills
39:17to get better-paying work in the future.
39:20So, the government can think of that,
39:22and this makes your structure stand out.
39:24As a bonus, think of new job trends.
39:28This could be positive or negative. On
39:30the positive side, what are the new
39:33uh uh
39:34jobs that are emerging in the world that
39:37are not really job categories yet, but
39:40that will be in the future? So, just
39:43like social media marketing was maybe 5
39:46or 10 years ago, what are the jobs that
39:48are coming up? And on the negative side,
39:50what jobs are going to be automated
39:52through software?
39:54Right?
39:55Uh you don't see
39:58you don't see a lot of spell checkers
39:59nowadays. There were people who worked
40:01with that back then. You don't see a lot
40:04of those nowadays because software does
40:06it all.
40:07And there are many jobs that are going
40:08to be automated away, and you don't want
40:10to be doing those jobs because you're
40:11going to train a whole population to do
40:14that, and then 3 years from now,
40:16uh some guy in a garage in Silicon
40:18Valley just or maybe Google develops a
40:21software that does that work.
40:24And then the second issue is
40:26infrastructural factors. And I'm putting
40:29this in a generic way here
40:31because it doesn't really matter
40:34if you
40:36get all of them, but the idea is to show
40:38the interviewer that you understand that
40:41there's a lot more to to the system than
40:45just
40:46having the right workers and having the
40:48demand. You need also the training. You
40:51need good internet. Maybe the
40:55Philippines is isolated because they're
40:58island they're they're a nation of
41:01several islands and maybe a lot of those
41:03islands don't have good internet because
41:06no one's
41:07done the the
41:10no one's passed the the ocean cables.
41:13And if you're to develop this
41:16this industry, you need
41:20the infrastructure to do so. And the
41:22financial infrastructure as well. And
41:23there might be other types of
41:25infrastructure that I missed, but the
41:27idea is you need to bring some
41:30infrastructural factors to stand out.
41:33And if you did so, you will stand out
41:35because a lot of candidates will go
41:37through this case and not mention
41:38internet connection. I know it sounds
41:41silly, but it is really really
41:42important. If you want to develop an
41:45economy
41:46thinking about the infrastructure is
41:48something that I wouldn't say most
41:50candidates wouldn't do, but I would say
41:52that a lot of candidates would not. And
41:55if you did, you will stand out in some
41:57way.
41:58Okay. So, I hope this video gives you
42:01more clarity on how to structure public
42:05sector cases.
42:07It's not hard if you know how to think
42:09from first principles, if you try to
42:11understand the role of each uh part of
42:13the system within the system,
42:16but it's definitely different than
42:18structuring business cases because
42:22for most public sector cases, you'll not
42:24have seen the the problem
42:29uh or a similar problem before, and I
42:32hope that I
42:34gave you the sense as well with this
42:36type of case
42:37of stimulating an industry. And I hope
42:40you've liked it, and I'll see you in the
42:41next video.

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