Estimating techniques in PRINCE2
There is various proven project estimating techniques, and I shall now describe the most popular approaches to obtain accurate estimating for your project:
Delphi technique.
This relies on obtaining group input for ideas and problem-solving without requiring face-to-face participation. It uses a series of questionnaires interspersed with information summaries and feedback from preceding responses to achieve an estimate.
Bottom-up estimating.
Each individual piece of work is estimated on its own merit. These are then summed together to find the estimated efforts for the various summary-level activities and overall plan.
Parametric estimating.
Basing estimates on measured/empirical data where possible (for example, estimating models exist in the construction industry that predict materials, effort and duration based on the specification of a building)
Single-point estimating.
The use of sample data to calculate a single value which is to serve as a ’best guess for the duration of an activity
Comparative estimating.
Much data exist about the effort required and the duration of particular work items.
Over time an organization may build up its historical data regarding projects that it has undertaken (previous experience or lessons learned).
Where such data exists, it may be helpful to reference it for similar projects and apply that data to the estimates.
Top-down estimating.
Once an excellent overall estimate has been arrived at for the plan (by whatever means), it can be subdivided through the levels of the product breakdown structure.
By way of example, historically, development maybe 60% of the total, and testing may be 30%. Subdivide development and testing into their components and apportion the effort accordingly.
Three-point estimating.
Ask appropriately skilled resources for their best-case, most likely and worst-case estimates. The value the Project Manager should choose is the weighted average of these three estimates.
Top-down and bottom-up approaches.
An overall estimate is calculated for the plan. Individual estimates are then calculated, or drawn from previous plans, to represent the relative weights of the tasks.
The overall estimate is then apportioned across the various summary and detailed-level tasks using the bottom-up figures as weights.
Basic rules for estimating:
Many books and software packages include some basic rules to help ensure that an accurate and realistic estimate is produced.
Examples of such planning rules include:
- Always estimate the work effort and then calculate the duration based on the resources available to do the work.
- Always build in provision for problem-solving, meetings and other unexpected events.
- Cost each activity rather than trying to cost the plan as a whole. Communicate any assumptions, exclusions or constraints you have to the user.
- Assume that resources will only be productive for 75% of their time. Resources working on multiple projects take longer to complete because of time lost switching between them.
- People are generally optimistic and often underestimate how long tasks will take.
- Make use of other people’s experiences and your own.
- Ensure that the person responsible for creating the product is also responsible for creating the effort estimates.
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