The MECE principle, which stands for Mutually Exclusive and Collectively Exhaustive, is a systematic approach to breaking down complex problems into smaller, manageable parts. In financial management, it can be applied to various aspects such as calculating company profits. For instance, the formula Profits = Revenue - Costs is a MECE framework. Here, Revenue is broken down into Units sold and Price per unit, and Costs into Fixed cost and Variable cost. This ensures that all possible factors contributing to the profits are considered (collectively exhaustive) and that there is no overlap between the factors (mutually exclusive).
How can you make every idea count and have every problem efficiently solved? Our McKinsey MECE Princ...
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