There are several steps you can take to tackle an estimation case in a consulting interview. The estimation case is to be solved through conversation. Walk the interviewer through the steps below, tell her what you are calculating and why, and what your assumptions are.
Depending on where you live, you should know the population in that country. The questions are usually tailored to the country or even city you are in to make them more relatable. Some may also ask you more difficult questions, as in example four from the list I provided earlier (“How many golf balls fit into an Airbus A320?”), so I recommend you go over some volume formulas. In this case, you would calculate the volume of the different parts of the aircraft and the volume of a golf ball, and then divide one by the other. Of course, you can also add the packing efficiency of spheres formula, see how you get along with time, and add it at the end.
If you take the second example (“How many electrical sockets are there in Germany?”), you would start by saying:
There are two categories in this question. First, there are the electrical sockets where people live, and second, the electrical sockets of the businesses around Germany.
At the end of the interview question, you should have the below diagram on your piece of paper in front of you:
First, I will categorize the question into two buckets: private households and then businesses.
Let’s start with private households, I would cluster the German population into three different groups: Kids and babies, older people, and everyone in between.
We don’t need to consider kids and babies anymore, because they live with their parents.
Then we cluster the adults and the people above 80 years old. (20 percent of older people, because we have an aging population in Germany).
That leaves us with 50 million people between the ages of 18 and 80, who, with a probable 50/50 split, are either single or have a family.
Assuming the single people live in a 2.5-room apartment with a total of five electrical sockets per room. Assuming that two people live in the family household of a five-room apartment, with five electrical sockets per room.
And assuming that 20 million people live in elderly homes or single-room apartments, with five sockets in total.
We conclude that the total for private households is 1,000 million electrical sockets. For businesses, we can assume that half of the population goes to work and that every employee has at least five electrical sockets either in her office or where she works.
We conclude that there are 200 million electrical sockets in businesses.
Leading us to a total of 1,200 million sockets in Germany at a specific point in time.
As you may have noticed, we made a lot of assumptions, which may not reflect 100 percent of the reality, but that doesn’t matter, because this exercise is about simplifying the numbers so that you can calculate them in your head (or on paper via long multiplication/division) and come to a final number.