Nehaveigur

Many years ago and on a different continent, I used to work for a management consulting firm with offices in all of the world’s major cities. Part of the job was interviewing candidates for entry level consulting positions, and one of the things I liked to ask them was to do Fermi calculations.

Fermi calculations, named after the physicist Enrico Fermi, are a way of making educated guesses to arrive at approximate answers. In other words, they’re back-of-the-envelope calculations.

An example of a Fermi calculation I’d ask the aspiring consultants was, How many gas stations are there in the United Kingdom? Then I’d observe how they approached the question. One common strategy was to start with the number of people in the UK, then to use that to estimate the number of cars, then to estimate how often the average car needs gas, and so on. Some candidates had a natural talent for this type of thinking, while others couldn’t do it even after I assured them that the exact number didn’t matter and that it was about getting an order-of-magnitude estimate.

The Drake equation is a famous example of a Fermi calculation. It aims to estimate the number of extraterrestrial civilizations in our universe by multiplying factors such as the number of stars, the proportion of stars that have planets and the proportion of planets that support life. As such, the Drake equation is a Fermi calculation that aims to address another concept named after Enrico Fermi, the Fermi paradox.

My days as a management consultant are behind me, but I still do Fermi calculations almost every day.