Project Estimating Technique Paper CPMGT 303
Project Estimating Techniques
Project Estimating Techniques
One of the most important factors to the success of a project is how well the project is estimated, as well as how overall costs are managed during the execution phase by the project manager. Project costs and estimates are vital to the success of any organization to remain competitive in the market. Cost estimating for organizations rely heavily on resources that can sometimes be difficult to obtain. Forecasting and utilizing historical return costs are just a couple of ways that organizations rely on estimating. Experienced planners are often a sought trade within the market; this paper will discuss some often used project cost estimating techniques.
Types of Estimating
The first type of estimating is analogous. This type of estimating utilizes estimates from a previous project that is similar, and uses them to build estimates for the new project. While this type of estimating is beneficial to the planning process, caution must be used to ensure that estimates carried over from the previous project are fair and reasonable.
Parametric estimation takes historical data inputs, makes calculated assumptions based on market and statistical data, and then formulates the estimate. This type of estimating is useful as it does use historical data, coupled with statistical data; however, assumptions made by the planner can be skewed and lead to inaccurate estimates in my opinion.
The next type of estimating is bottom-up. Bottom-up estimating utilizes information from individual estimates through the Work Break Down structure. This type of estimating is one of the most common types of estimating because it uses estimates from the floor tasks. These floor tasks are estimated by subject matter experts with years of experience, and can be very beneficial to ensuring that not only the estimate is accurate, but the scope of the task is correct. Another type of estimating is three-point
Project Estimating Techniques
One of the most important factors to the success of a project is how well the project is estimated, as well as how overall costs are managed during the execution phase by the project manager. Project costs and estimates are vital to the success of any organization to remain competitive in the market. Cost estimating for organizations rely heavily on resources that can sometimes be difficult to obtain. Forecasting and utilizing historical return costs are just a couple of ways that organizations rely on estimating. Experienced planners are often a sought trade within the market; this paper will discuss some often used project cost estimating techniques.
Types of Estimating
The first type of estimating is analogous. This type of estimating utilizes estimates from a previous project that is similar, and uses them to build estimates for the new project. While this type of estimating is beneficial to the planning process, caution must be used to ensure that estimates carried over from the previous project are fair and reasonable.
Parametric estimation takes historical data inputs, makes calculated assumptions based on market and statistical data, and then formulates the estimate. This type of estimating is useful as it does use historical data, coupled with statistical data; however, assumptions made by the planner can be skewed and lead to inaccurate estimates in my opinion.
The next type of estimating is bottom-up. Bottom-up estimating utilizes information from individual estimates through the Work Break Down structure. This type of estimating is one of the most common types of estimating because it uses estimates from the floor tasks. These floor tasks are estimated by subject matter experts with years of experience, and can be very beneficial to ensuring that not only the estimate is accurate, but the scope of the task is correct. Another type of estimating is three-point