Real-Life Math
Product managers have to be able to make decisions based on numbers. This means being able to handle the math in the first place!
Here are 2 typical scenarios that a manager may have to handle in just one day:
Problem 1
You're a product manager with Ismart Technology. You've just met with Brainy Computers, and they want to buy your new accounting software package.
You go into the meeting room prepared to sell them the product for $300. It cost you $200 to develop. They say they will only buy the package for $250.
They're looking at you, expecting an answer. What do you say? Your bottom line is that you want to make at least 20 percent profit. Can you sell the software for $250?
Problem 2
You finish the deal and head back to the office. There, you meet with your new sales representative. You've spent $20,000 opening up an office space for her, installing a computer system and paying expenses to market this same accounting software.
She has been given 3 months to sell at least enough software to break even with the expense of hiring her.
You're now about to enter the third month of her agreement. She sold 67 software packages for $200 each during the first 2 months. If she sells the same amount in the third month, will she still be costing the company money or will she be making money?