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Project Management

4 Types of Project Estimate

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Project estimates are projections of costs, task completion times and resource needs for a project, often broken down by activity. Estimates are the basis for plans, decisions and schedules and their accuracy is critical. However, as future-looking approximations they are inherently subject to uncertainty. The following are common methods of developing project estimates.

1. Analogous Estimate

An estimate based on comparison to the effort required to complete similar activities or projects in the past.

2. Bottom-Up

Estimating the lowest level activities that you can identify and aggregating the results to determine estimates for higher level activities and the entire project.

3. Parametric Estimates

Using an algorithm or calculation to develop an estimate based on a number of variables. Often produces estimates based on low level factors such of lines of computing code. People tend to assume parametric estimates are more accurate because they are often more complex. However, as with any estimate they are garbage in garbage out. In many cases, you end up asking a developer how many lines of code an activity requires instead of asking how many days it will take.

4. Three Point Estimate

The weighted average of optimistic, pessimistic and most likely estimates.
Overview: Project Estimates
Projections of costs, task completion times and resource needs for a project.
Related Concepts


This is the complete list of articles we have written about estimates.
Change Analysis
Fudge Factor
Schedule Risk
Scope Risk
Story Points
Work Complexity
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