This Slideshare presentation is a partial preview of the full business document. To view and download the full document, please go here: http://flevy.com/browse/business-document/price-hypothesis-generation-framework-323 Forming a coherent hypothesis is an instrumental tool when analyzing and addressing any business problem. It is a common approach used by management consultants. When evaluating any new, abstract business problem, it is wise to begin by forming an hypothesis related to the problem. A popular consulting framework for forming a hypothesis is PRICE. PRICE is used by strategy consulting firms like McKinsey, Bain, and BCG. It can be used to test a hypothesis, determine if the hypothesis is valid, and answer questions, like, Does the hypothesis make sense? Should it be discarded? Should it be reworded? This document explains the PRICE framework and provides template slides to be used in your own presentations.

1. Crowdsourced Business
Presentation Design Service
PRICE Framework
Hypothesis Generation
Forming a coherent hypothesis is an instrumental tool when analyzing and
addressing any business problem. It is a popular technique used by management
consulting firms. The PRICE framework helps us develop a proper hypothesis. This
document explains the methodology and provides template slides to be used in your
own presentations.
August 31, 2013
ORIGINAL PROJECT DETAILS
http://pptlab.com/ppt/Management-Consulting-Basics-PRICE-Hypothesis-Generation-40

2. Contents
 Framework Overview
 Templates
PPT Lab (www.PPTLab.com) – Crowdsourced Business Presentation Design Service
3

3. First, let’s formally define the term “hypothesis”
Hypothesis Definition
A hypothesis is a proposed explanation
for an observable phenomenon
The above pictured is the Andreas Cellarius hypothesis, demonstrating
the planetary motions in eccentric and epicyclical orbits
Note, that, by definition, a hypothesis must have 2 components—oftentimes, people
provide a hypothesis that only contains the ―observable phenomenon‖ portion.
PPT Lab (www.PPTLab.com) – Crowdsourced Business Presentation Design Service
5

4. By setting up the context, we can formulate the proper hypothesis that
addresses the right questions and discussions
PRICE Framework
P
Problems
E
R
Environment
Restrictions
By setting up the context for our
hypothesis, we can use the PRICE
methodology to:
• Frame the problem
Hypothesis
• Bring out the right questions
• Draw out the right
discussions
C
I
Criteria
Individual
PPT Lab (www.PPTLab.com) – Crowdsourced Business Presentation Design Service
7

5. … that can be answered, if we frame our hypothesis in the format “Due
to… We can… Resulting…”
Hypothesis Structure – Example (2 of 2)
What is creating the
phenomenon?
What is the observable
phenomenon?
DUE TO
WE CAN
securing exclusive
distribution rights with
Channel Partners A and B
…
reach a wider audience and
dominate the top 5
distributors
What is the outcome of the
phenomenon?
RESULTING IN
…
A ROCE of 30% for the
Emerging Markets.
The hypothesis must state the desired outcome of the phenomenon
(e.g. ROCE of 30% in Emerging Markets).
PPT Lab (www.PPTLab.com) – Crowdsourced Business Presentation Design Service
9

6. Insert headline
PRICE Framework TEMPLATE
PROBLEMS to be solved
• Filler text, filler text, filler text
• Filler text
P
ENVIRONMENT context
RESTRICTIONS on scope and
hurdles
Problems
• Filler text, filler text, filler text
• Filler text, filler text, filler text
• Filler text
• Filler text
E
R
Environment
Restrictions
Hypothesis
INDIVIDUAL decision maker(s)
CRITERIA for success
• Filler text, filler text, filler text
• Filler text, filler text, filler text
• Filler text
C
I
Criteria
• Filler text
Individual
PPT Lab (www.PPTLab.com) – Crowdsourced Business Presentation Design Service
11

7. Insert headline
PRICE Framework TEMPLATE
PROBLEMS
ENVIRONMENT
RESTRICTIONS
Hypothesis
Definition
INDIVIDUALS
CRITERIA
Insert bumper.
PPT Lab (www.PPTLab.com) – Crowdsourced Business Presentation Design Service
13

8. PPT Lab (www.pptlab.com) is the only crowdsourced
presentation design service. Get consulting-quality
presentations at a fraction of the cost!
www.PPTLab.com
support@pptlab.com
Each month, we will create well over 50 slides of for our members.
As a member, you will drive what business slides we create by
submitting your own presentation projects to our team. All
presentations will be created by a team of management
consultants and follow the Consulting Presentation Framework.
PPT Lab (www.PPTLab.com) – Crowdsourced Business Presentation Design Service
15