Regardless of the size, type or nature of your project and the methods applied (traditional, agile or a blend), estimating is required.
How many? How much? What type?
And remember we also need to agree are we estimating in hours, weeks, months, points (how much is a point?) or other units and what accuracy (or inaccuracy) is tolerable?
Estimating according to the PMBOK® Guide
The Project Management Institute’s (PMI)® A Guide to the Project Management Body of Knowledge (PMBOK® Guide) is a great source of project management techniques in all knowledge areas. Estimating techniques referenced include:
- Analogous estimating. Ever been in the early days of a project and you don’t have detailed information but you need to create a ballpark estimate? Well, we often use ours’ (and other’s) ‘expert judgment’ to estimate based on past projects and past experiences.
- Bottom up estimating. Have you ever gone to your SMEs for estimates for their part of the work and then aggregate them? Yes, such estimating is time consuming and requires a good understanding of the work involved. This can prove to be an expensive option, but typically has a greater accuracy level.
- Parametric. Parametric estimating involves using an algorithm based on past data and project parameters to provide an estimate. For example, 10 metres of cable can be installed per hour (based on past projects) so a model can be used to estimate how much time that installation activity will take based on the amount of cable required.
- 3 point estimating. Many PMs know this as PERT method or ‘best case, worst case, most likely’. Typically the weighted average of optimistic, pessimistic and most likely is used.
- Delphi technique. This method looks at reaching consensus of experts participating anonymously to remove ‘group think’. It can take time but its strength is in reducing bias from one person.
Where does PRINCE2® fit in with estimating techniques?
PRINCE2 as the leading global project management method interestingly does not prescribe or offer new PRINCE2-specific estimating methods. It references examples of techniques such as:
- Top down. Where an overall estimate is broken down (as opposed to other way around with bottom up)
- Bottom up
- Top down and bottom up (the best of both)
- Comparative estimating (see analogous estimating above)
- Parametric estimating
- Single point estimating
- 3 point estimating
- Delphi technique
Agile estimating methods
Any one for T-shirt sizing or story point estimating or Planning Poker®? As a seasoned ‘agilist’ you will be nodding yes, otherwise the reaction is typically “really?” Are we being serious here?
Agile practices often incorporate relative estimating and utilise what is known as the ‘wisdom of crowds’. Consider such approaches to estimating as:
- T-shirt sizing. A user requirement (or user story) is classified for example as S(mall), M(edium), L(arge) or E(xtra)-L(arge). The idea is that a medium user story is less than a large but bigger than a small. T-shirt sizing may use relative values (eg 1, 2, 4, 8).
- Story point estimating. A common form of estimating is to give requirements or user stories a point value relative to another. This is a team-consensus exercise with team members, for example, writing on paper their chosen value before revealing to the rest of the team. Once individual’s values are revealed, the team then discusses differences, understanding the reasons and reaching consensus on estimates.
- Planning Poker. Pre-numbered playing cards (such as 1, 2, 3, 5, 8, 13, 21 etc based on the Fibonacci sequence) may be used as a variety of points estimating. A requirement estimated at 8 points is deemed four times more effort than a requirement of 2 points.
The choice of which estimating approaches are best for your project will depend on a number of factors, including the timing in the project life cycle, project management maturity, adoption of agile practices and preferences of the project team. The key point to remember is:
“…when people are involved in the estimation process, their commitment towards meeting the resulting estimate increases”
PMBOK® Guide, PMI®
PMI and PMBOK are registered marks of the Project Management Institute, Inc.
PRINCE2 is a registered trade mark of AXELOS Limited.
Planning Poker is a registered trademark of Mountain Goat Software LLC