Revising the Concepts Learnt in Guesstimates

In this segment, we will go through every aspect of a guesstimate that has been discussed until now in this module:

We learnt that there are three kinds of guesstimates:

1. Shape or Geometry based 
2. Market sizing and 
3. Abstract

How you approach any guesstimate is dependent on the type it is. Once presented with a guesstimate, we should:

1. Think about the question
2. Clarify with the interviewer any ambiguity in the question
3. Align your overall approach with the interviewer and state your assumptions clearly
4. Break the solution into smaller, manageable parts, solve individually and combine the answers to get your final one

Some of the tips and tricks:

1. Using numbers which are easy to calculate (generally multiplication and division) and working in percentages wherever applicable.
2. Use of proxies, limiting factors and Pareto principle.
3. Effects of growth, replacement, perishability and wastage in the solutions are also factors that you can look at to get a more nuanced answer.
4. And finally, considering quick sanity check in your head to ensure your answer is correct and make corrections in the solution, in case it’s not.

And lastly, we discussed the importance of clear, concise communication of your approach, your assumptions and the process of solving with the interviewer throughout.