Day 6 - Guesstimate Questions
Solving guesstimate questions for PM Interviews...
Hello learners!
Welcome to the 6th lesson of the series 30 Days of PM Interview by Crework! Till now, we have covered product design interview questions and have practiced a few of them too. Today, we will start talking about another type of questions that are very popular in PM Interviews - Guesstimates.
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Guesstimates
Guesstimates are basically approximations based on the available limited information. A guesstimate is an information-based guess, not an accurate answer.
For example, if I ask you how many people travel through IGI Airport Delhi daily, I am not expecting you to tell me the exact number but to estimate the number using your thinking and assumptions.
It doesn’t even matter what exact number you give to the interviewer, but the process and rational behind that number matters more.
Guesstimate questions can cover a wide range of topics, including:
Market Sizing: Estimating the size of a market, such as the number of potential customers or total addressable market (TAM) for a product or service.
Volume Estimation: Estimating quantities or volumes, such as the number of golf balls that can fit in a school bus or the annual consumption of coffee in a particular city.
Revenue Projection: Estimating revenue or financial metrics, such as annual sales of a product or the potential revenue from a new business venture.
Time and Distance: Estimating time or distance-related scenarios, such as the number of pizzas sold in a city each day or the distance traveled by a commuter in a year.
Let’s talk about the “How”
The process of solving a guesstimate problem is pretty simple: Look at the possible parameters that may affect the final quantity, and estimate its numbers. When faced with a guesstimate question, follow these steps to structure your approach:
Clarify Assumptions: Begin by clarifying any assumptions you need to make to proceed with your estimation. Clearly state these assumptions to ensure transparency in your reasoning. This might be the common steps in all type of PM interview questions.
Determine Your Approach: Plan out your approach before diving into calculations. Ensure your method is clear and logical. Assign reasonable proportions for each segment based on your strategy. Keep communicating your thought process to the interviewer and seek their feedback.
Break Down the Problem: Break down the problem into manageable components or sub-questions. Make an equation out of the problem as soon as possible and try to come up with the values of each part of that equation.
Round Numbers and Approximate: Guesstimates don't require exact calculations. Instead, focus on approximations and rounding numbers to simplify your estimations. This approach helps streamline your thought process and yield reasonable outcomes.
Sanity Check: Finally, perform a sanity check on your estimation to ensure that your answer is within a plausible range and aligns with common sense. Revisit your assumptions and calculations if necessary to refine your answer.
The best way to understand guesstimates better is via examples. So, let’s jump into some.
Calculate the number of queries answered by Google per second.
We'll do a top-down approach.
Total searches per second= Total searches per day / 24 hours / 60 min / 60 sec
Calculating total number of users who search on Google
Global Population = say, 7.5B
Geographies excluded: China, Half of Russia (people here don't use Google as their primary search engine); So, remove 1.5B population.
That leaves us with a population of 6B
Only 50% of people are connected to the internet, that leaves us with a population of 3B.
Google market share with Bing, AOL, and other regional engines: Let's assume it to be about 70-80% = 75%.
So, we are left with 2.2B people who are potentially using Google search as their primary search.
Usage Frequency
We can segment them according to their frequency of usage. I would say there are 3 types of searchers:
Aggressive
Active
Passive
Passive searchers are those who don't use the internet to search daily (like old people, kids, and the majority of the rural population). Assuming this type represents the majority of 50% = 1.1B people
Active people would search once a day. Assumed to be 25% of the population = 550M people
Aggressive searchers are super active searchers who might search 4-8 times a day (Take average of 6). Assumed to be 25% of the total population = 550M people
Total searches per day = Number of users who search * Number of times they search on Google
Total searches per day = 550M * 1 + 550M * 6 = 3.8B searches per day
Total searches per second= 3.8B / 24 hours / 60 min / 60 sec = ~ 44,000 searches per second
That’s it for today people, for the next 2-3 days, we will be sending you sample questions and you will try to solve them to practice guesstimates.
Day 6 - Completed ✅
Congratulations on completing the 6th lesson of the series 30 Day of PM Interview. 🥳 Now, you know what to do. Share your learnings with the world and be accountable.
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