Project Estimation: 6 Methods You Can Use

Successful project planning starts with a successful estimate. However, project estimation is hard. Why? Because the only time you know precisely how long it takes to complete a project is when it’s done.

Up to the point of delivery, teams use educated guesswork to predict the future. And the bigger and more complex a project is, the hazier that future is. Faulty estimates mean missing deadlines and breaking budgets—two of the main symptoms of project failure.

See it this way; Try telling your boss you’ll need a deadline extension for a critical deliverable or asking for extra cash to complete the project, awkward right?

Project estimation methods can save you from being caught off guard when planning your projects.

What are project estimation methods?

Project estimation methods are techniques that help you accurately estimate the time, cost, and resources required to complete your project.

Here are trusted methods that can help you have a successful project;

1. Expert judgment

This is probably the most common way people get a project estimation. Talk to the men and women with the best hands-on experience and understanding of the project requirements. Just make sure that everyone has the same understanding of what needs to be delivered. And try to find experts who will actually be working on the project.

2. Comparative estimation

If your current project is similar to past ones, take the data from previous work and extrapolate it to provide your estimates for the new job. Before proceeding, make sure to check whether those projects were successful!

3. Top-down

Using a high-level work breakdown structure and data from previous projects, you can add estimates for each project work item to determine the overall effort and cost. The top-down method lacks detailed analysis, which makes it best suited for a quick first-pass at a prospective project to assess its practicality.

4. Bottom-up

In this method, each task is estimated individually, and then those estimates are rolled up to give the higher-level numbers. (If you use the right project management software, it will roll up the estimates for you). This process makes you think about what’s required in order to take a step back to see if the big picture still makes sense. You’ll receive more accurate results than the top-down method, but it’s also a greater investment of time.

5. Parametric estimation

Parametric estimation also uses historical data from similar projects but attempts to adjust for differences between past and present projects.

For this estimation technique, a set of algorithms calculate the estimate. Let’s say it took your marketing team four weeks to develop a campaign for the last product release. Well, that was a year ago, and your team is now twice as large. If every person on the team is involved in the campaign, you can assume it will take only two weeks this time to complete the same task.

6. Three-Point Estimating

Often when estimating from the bottom up, three-point estimating will be used. In this case, instead of estimating the duration of a single task, three estimates are applied. One is the optimistic estimate, the other is a pessimistic one, and, finally, the most likely guess. The average of these will be used as the actual estimate.

For example, if you’re developing an estimate for how soon your team can complete a project, you might use this method to establish the soonest possible date, the latest possible date and the most likely date.

Conclusively;

Understanding how to use different project estimation techniques can benefit you by ensuring you choose the best one for your specific project, saving you on time and resources.

Are you a project manager looking to gain skills on how to handle a project successfully? This Project Management Certificate Course is the right place to start. Sign up today!

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