Estimating

Question 1

what are the 4 types of estimating

Answer 1

1. analytical - bottom up
2. comparative estimating
3. parametric estimating
4. three point estimating

they can be used independently or in combination

Question 2

what are the 5 key characteristics of analytical estimating (bottom up)

Answer 2

1. based on WBS
2. all individual lower level tasks in WBS estimated separately then rolled up to produce project estimate
3. laborious and requires a correct WBS (accurate data)
4. most accurate - sometimes known as definitive
5. aimed for accuracy of 5%

Question 3

what are the 5 key characteristics of comparative estimating

Answer 3

1. called top down or historic estimating
2. uses experience from similar previous projects
3. takes overall cost/time for similar projects and adjusts for size and complexity
4. danger previous projects were inefficient or badly managed - varying circumstances
5. can be used at task level to support bottom up - quick to produce

Question 4

what are the 4 key characteristics of parametric estimating

Answer 4

1. uses mathematical model or formula to produce estimates based on input parameters
2. usually based on historical data - significant amounts required
3. examples are sqm or lines of code
4. industry norms (heuristics) must be kept up to date i.e. inflation

Question 5

what are the key characteristics of three point estimating

Answer 5

1. accepts uncertainty and considers 3 estimates for activity
2. most likely - optimistic - pessimistic
3. 3 estimates used for weighted average (PERT)
4. provides an increased level of confidence in provided estimate
5. can be used by software to calculate criticality of a single task or quantify overall risk exposure
6. part of monte carlo analysis

Question 6

what is the formula for single estimate value or PERT duration

Answer 6

estimated value = (optimistic + 4 * expected + pessimistic)/6

Question 7

what is the estimating funnel

Answer 7

the way in which accuracy improves over the project lifecycle

Question 8

what are the 4 phases of the estimating funnel

Answer 8

1. concept - ‘ballpark’ - accurate estimates difficult due to lack of information - +/-50%
2. design - used in business case approval - accuracy improves as planning process starts - +/-20%
3. definition - baseline cost/duration for project - more detailed planning produces better results - +/-10%
4. implementation - used to delegate work and asses progress - can see how good estimates were and can re-estimate future work - +/-5%

Question 9

what are 3 prerequisites for comparative estimating

Answer 9

1. project must have estimates comparable to previous projects
2. actual data from previous projects need to be available
3. circumstances around previous estimate correctly recorded for valid comparison

Question 10

what are 2 prerequisites for bottom up estimating

Answer 10

1. needs to be a complete WBS identifying all the work of the project
2. needs to be accurate estimate for each lower level task (work package)

Question 11

what are 2 prerequisites for parametric estimating

Answer 11

1. work must be suitable for parametric estimating - elements of scalable work i.e. brick laying
2. must be standardised data based on actuals - time for bricklayer to lay 100 bricks

Question 12

what are 5 sources of estimating errors in projects

Answer 12

1. optimism/pessimism - human or psychological factors may cause bias
2. social/political pressure - pressure from management, client, peers may influence estimator to provide ‘acceptable’ estimate
3. experience - lack of technical expertise of estimating skills
4. unclear scope - clear understanding of project requirements needed for accurate estimating
5. source data - comparative/parametric estimating require quality data - inflationary factors or incorrect assumptions will cause flaws