- Leading consulting firms
like BCG, Bain or Big 4, spend a lot of time, money and energy to train the new consultants, to train the new joiners of the firm. One of the things that is most focused on in these onboarding training
programs is communication. If you talk to any senior
consultant in these firms, they will tell you that
communication is key in the business world, and it's one of the skills
that young graduates from university lack most. Today, I'm talking
about the MECE principle of communication. It's a key principle, super relevant both for oral but also
for written communication. And if some of you already
know what MECE means, I trust that if you watched the video, you will still learn something new because in the end I'm
also going to show you super tangible exercise how you can apply the MECE
principle to your daily work to really improve your
especially written communication. Welcome to another coffee break here on my channel Firm Learning. My name is Heinrich and on my channel I want to
help you to become successful in the first years of your career. MECE is a term that is almost cliche. Whenever you will attend
the consulting training, MECE will almost always
be part of the curriculum. So as a little motivation, let's just check out some of
these MECE Consulting memes, just that we know what
we're talking about. So I just googled MECE meme
and the Google Picture Search and you can see that already
lots of stuff is popping up. So just pre-opened a couple of them. Let's just briefly check it out. So here "MECE all the things," this indeed is the motto of consulting, so pretty much everything
needs to be MECE. So this is indeed super important for other consultants, right? Or "MECE you say and master." Yes, it is important to
master the MECE principle to become a good
consultant that's for sure. "Framework not MECE? "I am disappointed." And indeed if you come up with a page or the slide that is not MECE you can trust that your senior partner will be disappointed indeed. "You had me at MECE." And of course if your own partner knows what the MECE principle is, then some consulting people might find that quite attractive or maybe the opposite but
I guess that's up to you. "Stay MECE my friends"
indeed guys stay MECE and you will be fine. So let's now look into
what MECE actually means. MECE is an acronym standing for Mutually, Exclusive,
Collectively, Exhaustive. And if you do not directly
understand right now what this means, just wait a sec I'm going
to explain it for you. So, Mutually Exclusive
means that different parts, should not overlap, they
should be disjoined, they should be separate from each other. And Collectively Exhaustive
means that several parts together should again form
the total of larger thing. MECE therefore is a principle
that you should apply whenever you decompose or
disaggregate a larger thing into its sub parts. So whenever you break something
down into smaller parts, when you have a problem
you want to do decompose it into smaller sub problems, into smaller sub facets of a larger thing, then this MECE principle comes into play and as I already hinted, this is something that is
of course super relevant to the consulting world, or to business practitioners in general, because for them it is a daily
task to break down things, to simplify things. So let's make it now a bit more tangible by looking at a visual representation of a MECE decomposition. What you see here is the MECE
decomposition of a circle. So let's imagine that you are tasked to break down a circle
into its sub components. And if you do it in the
way that is shown here, this decomposition would
meet the MECE principle because the sub parts
are mutually exclusive and collectively exhaustive. They are mutually exclusive because the parts do not overlap as you can see all the parts
are disjoined from each other and they are indeed
collectively exhaustive because if you take
all the parts together, the sum of them indeed
composes again a full circle. So maybe that sounds a bit complicated, but the truth is that
MECE is no rocket science. It is not really complicated, but it is rather something that we are all very familiar
with in our daily life. And for instance, you will absolutely naturally
follow the MECE principle if you would organize a
physical card collection. When I was a young kid, I
used to collect magic cards. It's a trading card game where
you can get lots of cards so that you can then
exchange with friends, where you then can also play
games against each other. Over my childhood, I collected hundreds if not
thousands of these cards. And as you can see, they're ordered and
they are indeed ordered by the color of the cards. So in this specific trading card game, cards had a distinct color, and I hope that you realize that by ordering the cards in this way, I was already following the
MECE principle at that time. But why is it MECE? And well let's look at the
first part Mutually Exclusive. If you put all your cards
into different groups, into different pockets of cards. Now in this example,
the colors of the cards. Then you put each card exactly
once into one of the pockets, and then this is mutually exclusive because these pockets
do not overlap, right? Because one card cannot be
in more than one pocket. But then of course it's
also collectively exhaustive because if every card has a color and you can assign every card to a pocket, then in the end all the cards we'll be distributed across the pockets, so this is then fine all
the cards would be gone, all the cards would be ordered. So yes, such a card collection will then be mutually exclusive
and collectively exhaustive, It will be MECE so as you can see, it is indeed no rocket science, but something that even many
kids will be able to do. So I hope it is clear now
what MECE actually means, but now let's get practical and let's jump in an example of how you can apply the MECE
principle to your daily work. So let's imagine the following scenario, you are working on a cost cutting project, either as a consultant or maybe also as an internal
employee in the company, and your objective that
you've been tasked with, by your senior management is to size the cost reduction potential for the client and to develop measures, to implement the cost reductions. So the management pretty
much wants to know, "Okay, roughly how much
cost can I take out "of different parts of the business, "and then what do I actually need to do, "what other measures do I actually achieve "these cost savings?" So you agreed on looking
into four concrete areas. This is the production,
the sales function, the purchasing function
and overhead, right? And for each of these areas,
now you size the potential, by doing some benchmarks
and some other things, you define some low hanging fruits, and then on top of that you identified more medium terms measures, now after identifying
all of this, you know, drafted a project plan
for the implementation. Now let's imagine you are an associate working on this project or as I said just a general
employee task with this and now your project leader
asks you to create an outline for the progress report of this project. And now I want you to pause the video and think for a second,
based on these information, if you would need to
draft a table of contents for such a report, how
would that look like? And let's now look into
two example outlines what people could have
done in order to jot down such a report. So let's look at this
first outline example. So this has four main points. First, the sizing of savings potential, so benchmark analysis,
activity-based sizing, results per business function. So in this first segment apparently, the social will propose to talk about, what the sizing was, what the identification
of the potential was. Then the second section is about, low hanging fruits measures. So in the area, production
sites and purchasing, now the low hanging fruits
measures are explained. Then the savings measures. So savings measures in
production, sales and purchasing, and then the proposed project plan would actually supposed to happen in order to bring this to life. So and again if you
just wanna take a moment to think about that, maybe also pause the video again. What do you think? what do you think about
this table of contents? Is this MECE? Do the elements here of this
progress report not overlap? So are they mutually exclusive, and are they collectively exhaustive? So do they cover all the key topics that you are supposed to talk about? And here with regards
to the MECE principle, I see at least two major problems. So the first problem is
regarding the first part. So mutually exclusive, and here in the sense, I believe it's pretty obvious, that for sure the sections two and three, they overlap because the
section three is called , the savings measures, but section two is talking
about savings measures as well, because these low hanging fruits, they are savings measures as well, right? Maybe they are a bit of a
different type of measures, but for sure that should be
subsumed under savings measures. So here the sections two
and three, they overlap, they're not exclusive, which is why this is a logic error in structuring this progress report, it is a violation of the MECE principle. But there is a second violation as well, and this is now in regards
to the second element of MECE namely the collectively
exhausting element. Here there is something missing, and maybe if we'll
remember the project brief in the beginning, there was
a fourth segment as well, there was a fourth area, that you as a team are
supposed to look at, and this is now the overhead area. So besides production
sites and purchasing, the overhead segment needs
to be looked at as well, and apparently this is now
completely missing here. This is not talking
about overhead as well, so it's not complete, it's
not collectively exhaustive so this of course again
it's a second logic error when drafting this report. Now let's look into a
second outline example. And here now the associate
decided to structure it in five sub parts of the overall project. So first he wants to talk about the sizing of the savings potential, by talking about the conducted analysis and also the results
per business function. Then he has headers for all the areas for the functions he looked at, first production, then sales, and then he aggregated
purchasing and overhead, and he always first talks
about the short term measures and then the medium term measures. And then in the end, is where the proposed
project plan is coming up. So now again, pause the
video, think of Bowman. What do you think? Is this MECE or not? And I would not argue that,
yes, this is MECE, right? Because the way that he
chose to structure it here by looking area by area, this automatically makes it
mutually exclusive, right? So these do not overlap, and of course we're going to
discuss whether purchasing and all that shall be
aggregated in one area or whether you make two
distinct areas for them as well. But I would argue if these
are maybe smaller parts, it's fine to also put them together or also because purchasing and all that are maybe a bit more similar in terms of content compared
to production and sales, and then within each of these areas, the short term measures and
the medium term measures are distinguished and now these is a way of putting it where these now do not overlap because short term is of
course now a different horizon of measures that you look at compared to the medium term measures. So of course it would also
depend a bit on the content of what exactly is written
within each of these points, but overall this would be now a structure, at least I would argue
that, yes this is MECE, this might very well work for your report. And the reason why the MECE
principle is so important, is that whenever you
create a presentation, whenever you write a written report, and ideally also whenever
you talk about something in a structured and professional way, you should follow the MECE principle. You should structure your
reports, your presentations, and also your oral arguments
in a way that they are MECE, that they follow this MECE principle, because if you do not in most cases, your structure is flawed, there's a logic error in the way you're presenting your findings and of course you want to avoid
that in the business world. If you have any more questions
about the MECE principle or communication in general, leave me a comment below
in the comment section and I will do my very best
to answer every single one. If you took any value
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order to become a member. Thank you so much for watching this video. I very much appreciate your time. And as also hinted in the beginning, I wanna make a series out of this talk like a consultant topic. So let me know in the comment, whether this is something that
you would be interested in and whether this is something
that you would like to see more videos on. But until then, thank you guys, enjoy the weekend and see
you again next Saturday.