Basic estimation techniques - Revision history

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	==Limitations==		==Limitations==
	The following have to be considered when estimating:		The following have to be considered when estimating:
	*Having detailed ~~estimation~~ form the ~~beginnings~~ can be problematic. If something changes these have to be updated, and this can end up in wasting a lot of time and money		*Having detailed estimations form the beginning of a project can be problematic. If something changes these have to be updated, and this can end up in wasting a lot of time and money.
	*Estimates that are there to give an idea, becomes the targets or the constraints.		*Estimates that are there to give an idea, becomes the targets or the constraints.
	*In general, estimates are limited in reliability. They are just educated-guesses that has to be reviewed and updated on a regular basis in order to be valid		*In general, estimates are limited in reliability. They are just educated-guesses that has to be reviewed and updated on a regular basis in order to be valid.
	*Ignoring relevant data, risks and uncertainties can lead to inaccurate estimates		*Ignoring relevant data, risks and uncertainties can lead to inaccurate estimates.
	*When the project is not broken down far enough some of the work can be misinterpreted		*When the project is not broken down far enough some of the work can be misinterpreted.
	*The human brain has a tendency to be optimistic about the future, and forget about unpleasant past events. ~~Thus~~, worst-case scenarios ~~in reality~~ are "worse" than the estimated ones.<ref name="Optimism_bias"> ''Meyer, W. G. (2016). Estimating: the science of uncertainty. Paper presented at PMI® Global Congress 2016—EMEA, Barcelona, Spain. Newtown Square, PA: Project Management Institute.'' </ref>		*The human brain has a tendency to be optimistic about the future, and forget about unpleasant past events. In reality, worst-case scenarios are "worse" than the estimated ones.<ref name="Optimism_bias"> ''Meyer, W. G. (2016). Estimating: the science of uncertainty. Paper presented at PMI® Global Congress 2016—EMEA, Barcelona, Spain. Newtown Square, PA: Project Management Institute.'' </ref>


	==References==		==References==
	<references />		<references />

Ripo at 23:00, 4 March 2019

2019-03-04T23:00:08Z

← Older revision		Revision as of 23:00, 4 March 2019
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	==Limitations==		==Limitations==
	The following have to be considered when estimating:		The following have to be considered when estimating:
	*One conundrum in estimating, especially for public-sector projects, is that bidders sometimes make overly optimistic estimates in order to win the business.<ref name="PMI_homepage"> ''https://www.pmi.org/learning/featured-topics/project-estimating Last access: 04.03.2019'' </ref> --> just in case
	*Having detailed estimation form the beginnings can be problematic. If something changes these have to be updated, and this can end up in wasting a lot of time and money		*Having detailed estimation form the beginnings can be problematic. If something changes these have to be updated, and this can end up in wasting a lot of time and money
	*Estimates that are there to give an idea, becomes the targets or the constraints.		*Estimates that are there to give an idea, becomes the targets or the constraints.
	*In general, estimates are limited in reliability. They are just educated-guesses that has to be reviewed and updated on a regular basis in order to be valid		*In general, estimates are limited in reliability. They are just educated-guesses that has to be reviewed and updated on a regular basis in order to be valid
	*Ignoring relevant data, risks and uncertainties can lead to inaccurate estimates		*Ignoring relevant data, risks and uncertainties can lead to inaccurate estimates
	*When the project is not broken down far enough some of the work can be misinterpreted.		*When the project is not broken down far enough some of the work can be misinterpreted
	*The human brain has a tendency to be optimistic about the future, and forget about unpleasant past events. Thus, worst-case scenarios in reality are "worse" than the estimated ones.<ref name="Optimism_bias"> ''Meyer, W. G. (2016). Estimating: the science of uncertainty. Paper presented at PMI® Global Congress 2016—EMEA, Barcelona, Spain. Newtown Square, PA: Project Management Institute.'' </ref>		*The human brain has a tendency to be optimistic about the future, and forget about unpleasant past events. Thus, worst-case scenarios in reality are "worse" than the estimated ones.<ref name="Optimism_bias"> ''Meyer, W. G. (2016). Estimating: the science of uncertainty. Paper presented at PMI® Global Congress 2016—EMEA, Barcelona, Spain. Newtown Square, PA: Project Management Institute.'' </ref>
	*External pressure:''' Moreover many times they are told to achieve specific cost, timeline and quality that may be unrealistic.

	==References==		==References==
	<references />		<references />

Ripo: /* Critique on Using Estimates */

2019-03-04T22:59:24Z

Critique on Using Estimates

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	==~~Critique on Using Estimates~~==		==Limitations==
	*One conundrum in estimating, especially for public-sector projects, is that bidders sometimes make overly optimistic estimates in order to win the business.<ref name="PMI_homepage"> ''https://www.pmi.org/learning/featured-topics/project-estimating'' </ref> --> just in case		The following have to be considered when estimating:
	**Estimation should be ~~for normal conditions~~		*One conundrum in estimating, especially for public-sector projects, is that bidders sometimes make overly optimistic estimates in order to win the business.<ref name="PMI_homepage"> ''https://www.pmi.org/learning/featured-topics/project-estimating Last access: 04.03.2019'' </ref> --> just in case
	**Risks and ~~special situations should be added later~~		*Having detailed estimation form the beginnings can be problematic. If something changes these have to be updated, and this can end up in wasting a lot of time and money
	*Optimism Bias
	*Is it good to have estimates so early in ~~the process, what happens if something changes?~~
	*Estimates that are there to give an idea, becomes the targets or the constraints.		*Estimates that are there to give an idea, becomes the targets or the constraints.
	*~~Limited~~ in reliability -~~-> sensitivity analysis on accuracy~~		*In general, estimates are limited in reliability. They are just educated-guesses that has to be reviewed and updated on a regular basis in order to be valid
			*Ignoring relevant data, risks and uncertainties can lead to inaccurate estimates
	~~Estimates should~~ be reviewed and updated on a regular basis, and ~~they should expressed in a manner that communicates an explicit notion of their reliability, for example expressing~~ estimates as a range of likely values. No magic tool will improve estimation; good estimation comes from rigorous process that is integrated into your other project management processes through out the life of the project. Like many other processes, it is best implemented using different techniques at different phases of your projects.		*When the project is not broken down far enough some of the work can be misinterpreted.
			*The human brain has a tendency to be optimistic about the future, and forget about unpleasant past events. Thus, worst-case scenarios in reality are "worse" than the estimated ones.<ref name="Optimism_bias"> ''Meyer, W. G. (2016). Estimating: the science of uncertainty. Paper presented at PMI® Global Congress 2016—EMEA, Barcelona, Spain. Newtown Square, PA: Project Management Institute.'' </ref>
			*External pressure:''' Moreover many times they are told to achieve specific cost, timeline and quality that may be unrealistic.
	*~~'''Insufficient defined scope of project: This can occur when~~ the project is not broken down far enough or some ~~works have been~~ misinterpreted.

	*~~'''Omissions:''' This happens when~~ the ~~estimator forgets to take into account important things that may result~~ in ~~different final cost~~.

	*''~~'Failure to conclude risks and uncertainty~~:~~''' Ignoring~~ the ~~risks and uncertainties~~ of ~~the project~~, ~~can lead to a very false estimation~~.

	*~~'''~~External pressure:''' Moreover many times they are told to achieve specific cost, timeline and quality that may be unrealistic.

	*'''Estimator and task performer fail to communicate:''' When the estimator and the task performer are two different persons they may have different level of skills or different view for the task that might lead to problems.


	==References==		==References==
	<references />		<references />

Ripo: /* Three-point Estimating */

2019-03-04T22:41:05Z

Three-point Estimating

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	The inputs for the different scenarios are provided by the output deriving from other single-point estimation techniques, for example, the parametric estimating. When combining the different scenarios, a more accurate estimate can be expected. This expected value (E) represents the average time the activity would require if it were repeated on a number of occasions over an extended period of time.<ref name="PERT"> ''https://en.wikipedia.org/wiki/Program_evaluation_and_review_technique'' </ref> The expected duration (E) can be calculated as a weighted average (PERT Mean):		The inputs for the different scenarios are provided by the output deriving from other single-point estimation techniques, for example, the parametric estimating. When combining the different scenarios, a more accurate estimate can be expected. This expected value (E) represents the average time the activity would require if it were repeated on a number of occasions over an extended period of time.<ref name="PERT"> ''https://en.wikipedia.org/wiki/Program_evaluation_and_review_technique Last access: 04.03.2019'' </ref> The expected duration (E) can be calculated as a weighted average (PERT Mean):

Ripo: /* Three-point Estimating */

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Three-point Estimating

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	E = (P + 4*M + O) / 6 [[File:Bottom-up example.JPG‎ \|thumb\|200px\|'''Figure 4:''' Bottom-up example in Microsoft Project for repairing and improving a pipeline, taken from Ten Six consultancy's homepage (2015).<ref name="Ten_Six"> ''https://tensix.com/2015/08/comparison-of-top-down-and-bottom-up-estimates-in-microsoft-project/'' </ref>		E = (P + 4*M + O) / 6 [[File:Bottom-up example.JPG‎ \|thumb\|200px\|'''Figure 4:''' Bottom-up example in Microsoft Project for repairing and improving a pipeline, taken from Ten Six consultancy's homepage (2015).<ref name="Ten_Six"> ''https://tensix.com/2015/08/comparison-of-top-down-and-bottom-up-estimates-in-microsoft-project/ Last access: 04.03.2019'' </ref>
	]]		]]

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	*'''Improve estimating process:''' in this phase the actual data and lessons learned are incorporated into the estimating processes and tools.		*'''Improve estimating process:''' in this phase the actual data and lessons learned are incorporated into the estimating processes and tools.


	==Techniques for Estimating==		==Techniques for Estimating==
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	Are more agile approach is the top-down method, which is based on the information currently available. The overall activity is estimated roughly, for example by using an analogous estimation for the task. As the project evolves, new information is then gathered and the previous estimate can then be refined. This method allows the project team to forecast and react quickly in a continuously changing environment.<ref name="Agile_estimation_techniques"> ''Sliger, M. (2012). Agile estimation techniques. Paper presented at PMI® Global Congress 2012—North America, Vancouver, British Columbia, Canada. Newtown Square, PA: Project Management Institute.'' </ref>		Are more agile approach is the top-down method, which is based on the information currently available. The overall activity is estimated roughly, for example by using an analogous estimation for the task. As the project evolves, new information is then gathered and the previous estimate can then be refined. This method allows the project team to forecast and react quickly in a continuously changing environment.<ref name="Agile_estimation_techniques"> ''Sliger, M. (2012). Agile estimation techniques. Paper presented at PMI® Global Congress 2012—North America, Vancouver, British Columbia, Canada. Newtown Square, PA: Project Management Institute.'' </ref>


	==Critique on Using Estimates==		==Critique on Using Estimates==
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	*'''Estimator and task performer fail to communicate:''' When the estimator and the task performer are two different persons they may have different level of skills or different view for the task that might lead to problems.		*'''Estimator and task performer fail to communicate:''' When the estimator and the task performer are two different persons they may have different level of skills or different view for the task that might lead to problems.


	==References==		==References==
	<references />		<references />

Ripo: /* Definition and Estimating Approach */

2019-03-04T22:32:52Z

Definition and Estimating Approach

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	==Definition and Estimating Approach==		==Definition and Estimating Approach==
	[[File:Model of estimation process.JPG\|thumb\|~~800px~~\|'''Figure 1:''' Model of estimation process, inspired by the one found in "Guide to the Project Management Body of Knowledge (PMBOK® Guide) (6th Edition)"]]		[[File:Model of estimation process.JPG\|thumb\|600px\|'''Figure 1:''' Model of estimation process, inspired by the one found in "Guide to the Project Management Body of Knowledge (PMBOK® Guide) (6th Edition)"]]
	The process of estimating is a common practice within Project Management of predicting a specific value that is not known with relative accuracy. An estimation can serve different purposes, for example, give an indication of the duration for a specific activity or the number of resources that must be assigned to a task in order to be completed in time. Figure 1 shows a model for the estimation process.<ref name="Body_of_Knowledge"> ''Project Management Institute, Inc. Guide to the Project Management Body of Knowledge (PMBOK® Guide) (6th Edition)'' </ref>		The process of estimating is a common practice within Project Management of predicting a specific value that is not known with relative accuracy. An estimation can serve different purposes, for example, give an indication of the duration for a specific activity or the number of resources that must be assigned to a task in order to be completed in time. Figure 1 shows a model for the estimation process.<ref name="Body_of_Knowledge"> ''Project Management Institute, Inc. Guide to the Project Management Body of Knowledge (PMBOK® Guide) (6th Edition)'' </ref>

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Critique on Using Estimates

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 *Limited in reliability --> sensitivity analysis on accuracy
 ==References==
 <references />

Ripo at 22:22, 4 March 2019

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	When managing a project, a manager has to achieve specific objects within time, resources and money. This can often be challenging, as there is a lot of uncertainty in doing so. ''"How can the amount of time for each activity be calculated"? "How many resources are needed to complete every task"? "And how much will the project cost in the end"?'' This article deals with answering all these questions and focuses on how to come up with educated guesses to these uncertainties.		When managing a project, a manager has to achieve specific objects within time, resources and money. This can often be challenging, as there is a lot of uncertainty in doing so. ''"How can the amount of time for each activity be calculated"? "How many resources are needed to complete every task"? "And how much will the project cost in the end"?'' This article deals with answering all these questions and focuses on how to come up with educated guesses to these uncertainties.

	In the first section, a definition of ~~an '''~~estimation~~'''~~ will be given. A variety of standard tools used in the estimation process will then be presented. Some of these tools and techniques are more complex than others and will, therefore, require a more detailed explanation. For every presented technique, advantages and disadvantages, as well as examples on how to apply these, will be given in order to give the reader an understanding of how the methods work and what they can be used for.		In the first section, a definition of the estimation process will be given. A variety of standard tools used in the estimation process will then be presented. Some of these tools and techniques are more complex than others and will, therefore, require a more detailed explanation. For every presented technique, advantages and disadvantages, as well as examples on how to apply these, will be given in order to give the reader an understanding of how the methods work and what they can be used for.

	Lastly, ~~a general guideline on how to approach the estimating process will be provided. Challenges~~ and limitations of using the techniques will ~~also~~ be discussed, as these can variate in accuracy depending on the type of the projects and the project phase in which they are applied. The involved risks when estimating will also briefly be covered here.		Lastly, challenges and limitations of using the techniques will be discussed, as these can variate in accuracy depending on the type of the projects and the project phase in which they are applied. The involved risks when estimating will also briefly be covered here.

Ripo: /* Definition and Estimating Approach */

2019-03-04T22:21:06Z

Definition and Estimating Approach

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	*'''Prepare to estimate:''' in this phase the activities that have to be estimated and the stimating team are identified, the estimating techniques are determined, the estimating inputs are prepared, and any constraints to the estimates, such as deadlines or funding limits, are documented.		*'''Prepare to estimate:''' in this phase the activities that have to be estimated and the stimating team are identified, the estimating techniques are determined, the estimating inputs are prepared, and any constraints to the estimates, such as deadlines or funding limits, are documented.

	*'''Create estimates:''' in this phase the estimates for the identified activities are calculated.		*'''Create estimates:''' in this phase the estimates for the identified activities are calculated and validated.

	*'''Manage estimates:''' after ~~the estimates have been validated and~~ the project work has started, ~~changing control, calibrating and comparing to~~ the ~~baseline~~ estimates~~...monitoring, control~~.		*'''Manage estimates:''' after the project work has started, the estimates are continuously monitored and updated.

	*'''Improve estimating process:''' the lessons learned ~~during the project estimation processare applied to~~ the estimating ~~lifecycle~~		*'''Improve estimating process:''' in this phase the actual data and lessons learned are incorporated into the estimating processes and tools.

	==Techniques for Estimating==		==Techniques for Estimating==