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John Spacey, February 29, 2016 updated on August 29, 2017
Estimates are forecasts of cost and time that are used to plan, develop strategy, manage operations and make decisions. The term estimate implies uncertainty and ambiguity where information is unknown and/or incomplete. The following are common types of estimates.
Estimates for the cost of work or purchases such as assets, tools, parts and materials.Time EstimatesEstimates for the time to complete tasks or processes.Cost and time estimates for a program or project, often at the task level.Should-CostAn estimate by the customer for how much a project or purchase should reasonably cost. Used to validate proposals and purchases.
QuotesPrices provided to a customer. In some cases, these are estimates of effort that may change based on actual work performed.Estimates of the probability and impact of risks.Market EstimatesEstimates of customers and competition. For example, an estimation of demand for a product in a particular region.
Value EstimatesEstimates of the value of assets such as property or software.Financial EstimatesEstimates of financial results such as revenue and earnings estimates for a firm's upcoming financial year.|
| Type | | | Definition (1) | Forecasts of cost, time, value, markets and performance that are used to plan and operate a business. | | Definition (2) | Future forecasts or current approximations that involve uncertainty. | | Related Concepts | |
Estimates
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