Introduction to Estimating

1
Introduction to Estimating

• Estimates, assumptions, duration and effort

2
Estimation exercise

• Part I

3
What are estimates?

• Assessments of the likely quantitative results
  of activities
• Always based on assumptions
• Used to predict effort and duration
• Things that should always include some
  indication of
• Accuracy or
• Certainty
• Things that should always be qualified
• (e.g. preliminary, high-level, low-level)
• NOT actuals

4
What are assumptions?

• Factors that, for planning purposes, are
  considered to be
• True
• Real, or
• Certain
• Factors that affect all aspects of project
  planning
• Identified, documented, and validated as part of
  the planning process
• Part of the progressive elaboration of the
  project
• Things that generally involve a degree of risk

5
Duration and effort whats the difference?

• Duration is
• The number of work periods required to complete
  an activity
• Usually expressed as workdays or workweeks
• Sometimes incorrectly equated with elapsed time

6
Duration and effort whats the difference?

• Effort is
• The number of labour units required to complete
  an activity
• Usually expressed as staff hours, staff days or
  staff weeks
• Should not be confused with duration, and padding
  should not be added

7
Estimation exercise

• Part II

8
Approaches to estimating top down estimating

• Also called analogous estimating
• Uses the actual durations of a previous, similar
  activity as the basis for estimating the duration
  of a future activity
• Frequently used to estimate when there is a
  limited amount of detailed information available
  (e.g. in the early stages of a project)
• Requires expert judgment
• Example Project A took 3 months to deliver,
  Project B is similar, therefore Project B will
  take 3 months to deliver

9
Approaches to estimating bottom up estimating

• Estimating the effort required to complete
  specific tasks, then summarizing or rolling up
  the the individual estimates to come to a total
• Generally considered to be more accurate than
  top-down estimating
• Example Activity X is made up of 2 tasks task
  A and task B. Task A will take 3 hrs of effort,
  and task B will take 10 hrs of effort, therefore
  activity X will take 13 hrs of effort.

10
Estimation exercise

• Part III

11
Estimation techniques quantity-based estimates

• Also called parametric modeling
• Quantities to be performed for each specific
  work category multiplied by the productivity unit
  rate
• Quantity of Work Category Productivity
  Unit Rate Effort
• 10 HTML pages 2 hrs per page 20
  hrs of effort
• Useful even if the quantity for each work
  category is unknown assumptions can be made and
  estimates can be based on those

12
Estimation techniques the WAVE technique

• Weighted AVErage calculates an average skewed
  towards the most likely estimate
• Low (4 Most Likely) High Effort
• 6
• TTC to work
• 20 mins (4 30 mins) 90 mins
  38.3 mins
• 6
• Generally considered to produce more accurate
  estimates

13
What is variance?

• Any difference between the estimated cost of an
  activity and the actual cost
• Any difference between the scheduled completion
  of an activity and the actual completion

14
Estimation exercise

• Part IV

15
Estimation exercise

• And the answer is
• (to be revealed in workshop)

16
Review the tie back

• Estimates are assessments of the likely
  quantitative results of activities
• Estimates are based on assumptions
• Estimates are used to predict effort and
  duration
• Estimates should be revised as assumptions
  change
• Estimates should always include a degree of
  accuracy or certainty
• Estimates should always be qualified
• Top-down estimates require expert judgment, and
  are typically inaccurate
• Estimate early, estimate often!

17
Thank you!

• For more information, please visit
• http//importantprojects.co.uk