About a year and a half ago, I was asked to forecast future revenue for a few of our businesses in a particular area. We would then use those forecasts to help decide how much to invest in our business, and where.
I had to forecast parameters that would dictate how much our customers would spend on goods and services like ours (a.k.a. the total available market, or TAM). Because of the uncertainty around several parameters, I used the Monte Carlo method.
I could have used some brute force techniques and come up with an answer in an hour or so. Instead, I took the time to design a model that was flexible and robust. I realized I could then use that model to simulate a bunch of different scenarios, and answer questions beyond the particular investment question we immediately had in mind.
What does this have to do with engaging potential career sponsors? You can use your model-building skills to open all kinds of conversations. Here’s one way to start a conversation that could have a profound impact on your career development:
- Listen closely when you’re asked a question that a model can help you answer.
- Think about the formulation of the question, and what other, closely-related questions might be interesting to answer.
- Rather than throw something together quickly, take a little bit of extra time to design a more general model that can answer a broader, related class of questions.
- Answer the posed question with the model you built. Return that answer ASAP.
- Use your model to answer a related question, or two, that you find interesting, and that sheds light on some aspect of your business.
- Share your thoughts, along with the model design and output, with one of your stakeholders. Initiate a conversation by requesting feedback, or asking how to more accurately model business reality.
When written out, this sounds like a bit of a show off. But that’s not what I mean. I suggest you use models to help you think more clearly, and more broadly, about you business. Use models to study scenarios, where you can change assumptions and consider how your business, your competitors, or your customers might respond.
It’s one thing to passively think about your business when you read articles, or engage in casual conversation. It’s another thing entirely to put pen to paper and actively build a model.
As long as you broadcast all your assumptions, you won’t look silly. Sure, you might have built a model so simple that it doesn’t capture reality. But your assumptions will drive a conversation. And it gives your stakeholders a chance to share their expertise, which makes them feel good. Everyone wins.
Don’t get tunnel vision in your rush to answer a question from an important stakeholder. Think about how to generalize your solution. Then use that generalized framework to answer similar, related questions. It’s a great way to start a conversation, show your initiative, and capture visibility for your work.