Approach to

Guesstimates.!
Definition

Basic meaning of guesstimates:

• An estimate based on a mixture of guesswork and

calculation - Guess + estimate .
• Always remember it is about the approach used to
reach the number and not the final number.
Can I consider everything.?

• Choosing factors that you can derive or guess

about based on some top-of-the-house numbers
that you already have
• Excluding any factor that is an exception to the rule
or doesn’t make a significant difference to the
No – simplify approximate amount
your life by: • Reading the problem statement again – what do
you really need to calculate (eg. Kgs of surf used,
bought, sold or manufactured)
Clarify.!

Before attempting the

question itself, see if
there’s anything the
evaluator can clarify that
will allow you to narrow
down the scope of the
consideration
Don’t
• Looking at a question and thinking, ‘I
don’t have any data or information
about that. There’s no way I can crack
this.’
• Instead, work with the numbers you
already have and using deductive
thinking, develop the most direct
connection you can between your
umbrella number and the final
estimate required
Let us try solving this:

Can you estimate the amount of surf excel powder used in India
per day (in kg)?
Frame work

Mutually Exclusive, Collectively Exhaustive (MECE)

It is a method of grouping information into elements

that are mutually exclusive (ME) and collectively
exhaustive (CE).
Method

Think of all the factors that affect the numbers of

whatever you’re calculating and categorize them into
buckets that follow the MECE framework.

For a defined structure you can have broad categories like

demographics, Psychographic and attributes.
Structure

Demographics Psychographic Attributes

• Location • Brand affinity • Changes

• Age • Brand according to
• Income perception the problem
• Gender • Spend capacity statement
• Race/ethnicity
• Occupation
Demographics

Location Age Income

• Rural • Minor • High
• Urban • Adult • Medium
• Senior citizen • Low

Gender Occupation
• Male • Unemployed
• Female • Blue collar
• Other • White collar
Psychographic
Brand Affinity : Likelihood that the customer will stick with
the same brand.

Brand perception : Customers opinion on the brand it might

be positive, neutral or negative.

Spend Capacity : Customer’s ability to spend on the product

or the service.
Attributes

These keep changing according to the question.

They are nothing but the personal choices

Can you estimate the amount of surf excel powder used in India per
day (in kg)?

LETS BE MORE DILIGENT THIS TIME

 Solution 1B
Population of India

0.7 0.3
Rural India Urban India

0.6 0.3 0.1 0.6 0.3

0.1
Low income Medium Income High Income Low income Medium Income High Income

0.8 0.2 0.3 0.7 0.4 0.6

Not surf Not surf Not surf
Surf excel Surf excel Surf excel
excel excel excel

0.3 0.7
0.4 0.6 0.7 0.3 Not surf
Not surf Not surf Surf excel
Surf excel Surf excel excel
excel excel
 Calculations
• Now, with the help of assumptions made calculate the final number
100 crores

7000000 3000000

4200000 2100000 700000 300000 1800000 900000

840000 1260000 490000 90000 1080000 630000

Total= 4390000
Calculations

• Now, further assume each person uses 50grams of surf excel per day
• That means,
• 4390000 * 50 = 219500000
• But the question asks for surf excel used per day in kgs.
• As 1000grams = 1 kg
• So, now 219500000 / 1000 = 219500
• The solution is 2,19,500 kgs of surf excel is used per day in the country.
Presenting your solution

Start by stating your umbrella assumption/number

Clearly state the factors you’re considering within your solution

• Preferable to stating these one by one

Also state the factors you’re excluding from consideration and why

Use round numbers