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How to Achieve Accurate Project Time and Cost Estimates

How to Achieve Accurate Project Time and Cost Estimates
By Paul A. Weber

What are Time & Cost estimates?

These are the project estimates in relation to how much time is required for your project. Cost is related to how much financial investment will be necessary for your project,

Why Time & Cost estimates are important?

I know you are thinking “This goes without saying”, but let’s explore this point anyway. Time and cost estimates are intertwined, because either one has a direct effect on the other. When determining the cost of a project, or a specific area of a project, time estimates are usually included, because time is literally money. Projects are not only cost determined based on material, but also according to the time estimated for project completion. This time is usually applied to the overall cost of the project because people get paid for the actually work they perform, but also the time taken to complete a task. Read the Complete Article

Five Common-Sense Time Management Mistakes In Project Accounting

Five Common-Sense Time Management Mistakes In Project Accounting
By Curt Finch

Chances are you’re quite familiar with project accounting, and you understand how financial reports that track the financial progress of projects can be used by managers to aid project management. Project accounting gives businesses insight into the comparative value of current and past projects, as well as the projected value for future endeavors. However, if project accounting is approached primarily from the top down, these estimates may be flawed. Project knowledge must be granular, and individual team members should contribute and review that information on a per-person level to determine its accuracy.

Unfortunately, it is often the case that businesses implementing a project accounting system, even if done with the goal of tracking individual time and resources to projects, might run into a snag: team members just do not have the time, desire, or know-how to accurately account for activities and expenditures. Read the Complete Article

Estimating Is Often Helpful – Estimates Are Often Not

Estimating Is Often Helpful – Estimates Are Often Not
By Esther Derby

Recently, I tweeted, “Estimating is often helpful. Estimates are often not.”

Several people asked, “How can this be?” Let me say more, in more than 140 characters.

Estimating Is Often Helpful

  • Estimating helps when the process of estimating builds shared understanding among the people who want the work done and the people doing the work..
  • Collaborative estimating gives the best results. Diverse experience yields a broader range of perspectives and questions. Questions and perspectives build understanding of the what, why, and who related to the request. That’s helpful.

  • Group estimating reveals differences in knowledge and understanding. Finding those gaps early is helpful.

  • Group estimating surfaces assumptions. When we are aware of our assumptions, we can verify–or debunk– them.

  • When the group knows enough about the “what” to think about the “how,” they can analyze implementation. Working out implementation details reveals more assumptions, and generates more questions.

Read the Complete Article

How Accurate Is Your Actual vs. Planned Time and Costs?

How Accurate Is Your Actual vs. Planned Time and Costs?
By Peter Collins

With cost and efficiency dominating the corporate agenda in today’s constrained operating environment, the ability to compare and contrast planned versus actual time and costs provides professional services firms with greater visibility and tighter control of performance in billable markets where time is money.
By Peter Collins, director, Retain International

The ability to plan effectively is crucial for professional services firms operating in billable markets such as accounting, consultancy and law. But being able to allocate time and cost (of resources) with absolute confidence that financial and project targets will be met is difficult if resource planning tools and timesheet systems are being used in isolation, as they typically are today.

Timesheets provide an accurate view of the hours being billed at the end of each week or month, making it relatively straightforward to calculate the actual cost of resourcing a project and the revenue generated as a result. Read the Complete Article

Simple Guide to Quickly Sizing/Costing a Project Up Front

Simple Guide to Quickly Sizing/Costing a Project Up Front
By Neil Killick

  1. Identify high level requirements (epics and stories) and size them XS, S, M, L or XL (T-shirt sizes) so that each story in each category is roughly the same size (in terms of effort) as the other stories in that category
  2. Ensure that the XS stories are extremely small pieces of work that cannot be broken down any further (like a 5 minute change to the system) – if you do not have any of these, break down the S stories to ensure you have both XS and S stories

  3. Now have the project implementation team (i.e. developers, testers, analysts, etc. – not product/project managers) perform Fibonacci Planning Poker estimates (1,2,3,5,8) for 5 stories in each of the S, M, L and XL categories (we will assume all XS requirements are 1 point)

  4. If there are less than 5 stories in a category, or not many more, simply estimate all the cards for that category

  5. L or XL stories that are larger than 8 points should be made XXL and re-estimated including the 13, 21, 34, 55 and 89 point cards

  6. If you have estimated all stories in a category, simply total the points for that category, otherwise total the points for the 5 stories you have estimated, divide by 5 and then multiply by the total number of stories in the category (we can do this because we determined that the stories in a given category are roughly the same size)

    e.g.

Read the Complete Article

Estimating the Unknown: Dates or Budgets – Part 1

Estimating the Unknown: Dates or Budgets – Part 1
By Johanna Rothman

Almost every manager I know wants to know when a project will be done. Some managers decree when a project will be done. Some managers think they can decree both the date and the feature set. There is one other tiny small subset, those managers who ask, “When can you finish this set of ranked features?”

And, some managers want you to estimate the budget as well as the date. And now, you’re off into la-la land. Look, if you had any predictive power, you’d be off somewhere gambling, making a ton of money. But, you do have options. All of them require iterating on the estimates and the project.

First, a couple of cautions:

  1. Never, ever, ever provide a single date for a project or a single point for a budget without a range or a confidence level.
Read the Complete Article

8 Reasons Why the Estimates Are Too Low

8 Reasons Why the Estimates Are Too Low
By Jens Schauder

One of the most difficult tasks in a software development project is estimating the size of the project. Unfortunately very often you have to do it at the very beginning of a project, when you have the least information. The result at the end is very often a large difference between the original estimate and the actual time and money needed.

If the difference is positive as often as it is negative this is kind of OK. But in some teams estimates are too low almost all the time! The obvious strategy often employed is to add a certain percentage to the estimate. But of course that is just fixing the symptoms, because most of the time nobody knows the reason. So in this article I am going to show several reasons for bad estimates, how to identify them and also a possible fix. Read the Complete Article

Estimating Software Effort

Estimating Software Effort
By Sydney du Plooy

Estimating the effort it takes to produce a software product is a fairly difficult process. There are a couple of reasons why. They range from management politics to subjective guesses of how long programming tasks will take.

How then do you estimate the effort of a project with such uncertainties?

At the start of the project we should be able to get some idea of what the end-product will look like. From that, we can start estimating how long the bits and pieces will take to develop. Now that seems easy, but estimating how long the bits and pieces will take is not as simple as it seems.

Over- and Under-estimating Effort

Let’s look at Parkinson’s Law. It says that “Work expands so as to fill the time available for its completion.” If the task ends up being easy, then we will waste time and work less hard. Read the Complete Article

Critical Path With MS Project

Critical Path With MS Project
By Simon Buehring

Creating a realistic schedule is a key responsibility of any project manager. This schedule must be updated regularly throughout the duration of the project to ensure that the project manager is aware of any issues or delays that might affect the product delivery date. Too many delays can lead to additional expense, customer dissatisfaction and project failure.

The Critical Path Method (CPM) is a widely-used technique developed by project managers to enable close analysis of the factors affecting the project schedule. Through Critical Path Analysis (CPA), project managers are able to make more accurate schedules and estimations.

The popular project management software, MS Project, includes various tools to facilitate creating and managing a CP. This article considers how MS Project can make developing and using a CP a simple, step-by-step procedure.

Creating a CP using Microsoft Project

Microsoft Project allows users to create and manage a CP using the Gantt Chart capability. Read the Complete Article

Project Timelines – And The Lies We Tell

Project Timelines – And The Lies We Tell
By Barney Austen

After years of project implementation in practically every field, the project time-line is the one thing that is consistently messed with. But why is this the case? Why do such a large number of projects fail to come in on time? We have tools and processes coming out of our ying-yangs and yet we still don’t manage to deliver when we say.

To me, the issue is nothing to do with tools or processes. The fault often lies with the end-customer over-demanding and the supplier over-promising to meet that demand. We’ve all done it and continue to do it on a daily basis.

Why?

To get the deal.

And what happens?

Under pressure project delivery teams, a customer who is highly frustrated and a timeline that doesn’t get hit as we all knew would happen.

Here’s a revolutionary idea – why don’t we all try to be honest with one another at the beginning of the timeline i.e. Read the Complete Article

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