5 Tips for More Accurate Project Estimating

If you’ve been a project manager for a significant amount of time, you understand that project estimating can be a bit of a crap shoot. The future is murky and it is up to us to attempt to predict it. Oftentimes, project managers end up far off from their estimations due to a number of variables, some of which are totally unexpected and pop up in the middle of the project. Other times, estimates are off due to the inherent subjectivity of the project manager. Let’s take a look at a few tips to improve our project estimating.

Tips for Project Estimating

1. Don’t Force The Numbers To Fit The Budget

Oftentimes, project managers feel pressured to make their forecasts fit into the constraints of the project’s budget. When a project manager can keep his estimates low, it looks good to fellow mangers and executives within the organization. Yet this type of estimate only serves a purpose while it is on paper. It doesn’t actually have a real world application. Once an overage occurs, the burden is on the project manager to explain why such low figures were estimated. Project managers must be willing to alter the scope if it conflicts with the budget. It is up to them to request that their team work within the budget’s constraints to get the job done.

2. Include The Risks

If your team isn’t acutely aware of common risks, it will be difficult to accurately estimate the costs and time span of a project. During the typical project estimating period, a team will zoom through an assessment, come to the consensus that the project is risky and automatically add extra hours to the forecast. This isn’t the proper way to estimate. When you plan, you should apply the mitigation plans and the registered risk while considering the time that it will take to execute them. For example, if you believe that you can save time down the road with a technological solution that will save 100 hours, be sure to account for the 30 or so hours that it will take to create and implement the solution in the first place.

3. Establish A Contingency

When you are forecasting a project, you should always include a contingency. This is something that is included at the outset of a project with the expectation that it will be spent. So don’t exclude it just to make it appear that the project won’t be costly. Aside from the monetary contingency, you should also include estimations for the resources and the hours that it will take to complete all of the work that the contingency presents. Remember, if you don’t need the contingency, the project will be done sooner than expected and your business will still hold onto the funds for future use.

4. Outsource Project Controls

It often helps to hire outside professionals to provide critical assistance with certain facets of the project. Sometimes you just don’t have the personnel in-house that is necessary to shoulder the load in a timely manner. Certain types of work require highly specialized skill sets and knowledge bases so don’t hesitate to outsource the work to people who can get it done quickly and in a comprehensive manner, like the experts at IMS.

5. Take Note Of Commonly Overlooked Activities

Be sure to double check for ancillary activities that are often overlooked. Things like client feedback, fixing bugs and meetings are often missed when project mangers attempt to consider all of the tasks, scope and deliverables. In reality, ancillary activities like those mentioned above occur quite frequently throughout a project and they can have an extremely negative impact on your estimation efforts.

While clear estimates will likely result in higher costs, you’ll save yourself plenty of drama, effort and time down the road by striving for accuracy. This way, you’ll be able to alter the scope or expectations at the outset of the project instead of dealing with them smack dab in the middle of a project.

Key Takeaways

  • Estimating isn’t exciting work but it must be done and it is necessary to be as accurate as possible.
  • Accurate estimating is essential to both the project’s success as well as your organization’s success so don’t manipulate numbers in an attempt to generate low anticipated costs.
  • A number of different factors must be considered when estimating. Don’t neglect certain factors just to present a low-cost project to your peers.

Sources:  LiquidPlannerRothman Consulting GroupCost Insights