Before I’ll explain the Minto Principle later this week, I’ll explore the term MECE (pronunciation: me see) with you, as it’s an important term in the Minto Principle, case interviews and consulting in general. MECE stands for ‘Mutually Exclusive, Collectively Exhaustive’ and is the consulting way of representing complex information in an easy way. Let’s look at both components separately.
If you are categorizing data, the MECE-principle dictates that the categories should be mutually exclusive. This means that it should not be possible for a member of group A to be a member of group B. To make it less abstract, an example of categorization that is not mutually exclusive:
- Grouping of people according to their color of clothes worn, as people can wear clothing with different colors, and others can wear these colors as well.
- Grouping of people according to their hobbies, since people can have multiple hobbies and two people can do the same hobby.
- Grouping companies according to their products, as they can sell multiple products at the same time.
You get the picture, I guess. So mutually exclusive categories are, for example: age, sex, nationality (often, at least). We got the ME- part, what about the other two letters?
Besides being mutually exclusive, the categories you pick should also be collectively exhaustive: all options/all information should be included in the categories you pick. This way you can be sure that there’s nothing you missed in your analysis. For example, the decision of a firm to acquire a competitor can be based on both financial and non-financial factors. These factors should then be broken down into new factors who are also (ME)CE. Another example is the profitability framework (example from my book below): it’s collectively exhaustive, as profit can be broken down into revenues and costs. No other factors influence profit.
In addition, the profitability framework is also mutually exclusive, as revenues can never be costs and vice versa. These factors can also be broken down into new MECE-factors. Revenues can be broken down into numbers of sales and the price: the revenue per sale.
During your case interviews, you should strive to be as MECE as possible when structuring your case. Don’t get bogged down while striving for perfection though, as you’ll only have limited time. But how to make sure you get it right the first time? As with most things: practice makes perfect. Apply the pyramid principle and MECE-thinking in real life: when choosing a vacation destination, while choosing between dinner options or when picking a new car.