Estimating

Question 1

What is an Estimate in Project Management?

Answer 1

A quantified assessment of resources required to complete part or all of the project. Stated in terms of cost + time + resources

Question 2

What is Analytical (Bottom-up) Estimating?

Answer 2

• Based on WBS
• Individual lower level taks estimated independently then rolled up to project project estimates
• Labourious
• Accuracy dependent on accuracy of WBS
• Most accurate way of estimating
• Aimed-for accuracy is to be within 5%

Question 3

What is Analogous (Comparative) Estimating?

Answer 3

• Take a known project and scale (up or down) appropriately
• Look at overall costs and timescales and adjust for size and complexity
• Danger - previous project may have been inefficient or badly managed
• Can also be used at task level to support Analytical Estimating

Question 4

What is Parametric Estimating?

Answer 4

• Relies on multiplying known number of units by price of each unit
• E.g. Square metres in construction
• Usually based on historic data which may be out of date
• Small errors in base data can get magnified

Question 5

What is Three Point Estimating?

Answer 5

• Based on calculating minimum and maximum cost, within which actual cost will lie
• E.g time and cost to perform a task - best case, worst case and most likely
• Estimated value = (Best Case + (4*Most Likely) + Wost Case)/6

Question 6

What is the Delphi Method of Estimating?

Answer 6

• Aimed at minimising influence of those engaged in estimating over other in the process
• Each individual produces estimation in isolation and submit to facilitator
• Facilitator will review and feed back summary to each member of group.
• Members will use to build their estimate
• May be an iterative exercise until facilitator satisfied that all possibilities appropriately considered, then output becomes estimate

Question 7

What is the Estimating Funnel?

Answer 7

• Estimates cost time and money to produce
• Estimating funnel shows how accuracy improves over lifecycle
• Demonstrates importance of re-estimating during project lifecycle
• Poor estimating is common cause of project failure