How to plan a successful project
13-January-2025
Setting up the financing and contracts for a project
13-January-2025
16 – ESTIMATING
Estimating is all about trying to predict the future, which makes it especially difficult. Poor estimating – of time, resources and budgets – has led to the failure of far too many projects. We need to know how to estimate the time, money and resources needed for a project reliably. That is because good estimates provide the basis not only for planning the project work but also monitoring how the work is proceeding against the plan.
The project to upgrade and re-equip the Wellington cable car system in New Zealand (seen in the video titles) would have required thoughtful estimating, like any other project. Therefore the team engaged a highly experienced Swiss company for the work.
The obvious and not so obvious things we need to estimate
16.1 – What we are estimating
The variables we need to be estimate need to clear. Some of them might surprise you. See which activities outside direct project work need to be considered.
You will learn:
- Why estimating in a project is so important.
- Why estimating for a project is so difficult.
- What has to be estimated in a project.
- What time and cost elements must be estimated in a project.
- How to get accurate project estimates.
- What is bottom-up estimating.
- What is top-down estimating.
- What techniques can be used in project estimating.
- How to get better estimates for a project.
Only with good estimates can we plan properly
16.2 – Budgets and schedules
Understand why good estimates are so important for the project, and what needs to be estimated. Explore techniques to get better estimates and avoid overlooking important factors.
In the case of a project like the Commonwealth Trans-Antarctic Expedition, fund-raising depended on good estimating. Accordingly funders had to be confident that once handed over their money would be used wisely.
You will learn:
- What is the project baseline.
- How to set the project baseline.
- What is a project budget.
- What are labour costs in a project.
- What is the learning rate in a project.
- What is the experience curve in a project
- What is PERT (the programme evaluation and review technique}.
- How to estimate a high risk in a project.
- How to estimate a low risk in a project.
- What are estimating cost categories in a project.
- What are the cost elements in a project.
- What are stage payments in a project.
- How to budget cash flows in a project.
Refining the project budget and time schedules
16.3 – The task network
Learn what the cost elements are that combine to create the project budget. See how project risk and repeating the same task can affect time and cost estimates. We mention the PERT method that was developed to resolve delays on the US Polaris missile programme and is still used today. Specifically we see how to work out how long the project should take.
You will learn:
- How to estimate task duration in a project.
- What is an activity on node network in a project.
- How to create an activity on node task network in a project.
- How to calculate the critical path in a project.
- What is the definition of the critical path in a project.
- How to estimate the duration of a project.
- How to add contingency to the critical path of a project.
- What is a Gantt chart.
- How to use a Gantt chart in a project.
Creating a realistic task network
16.4 – Resourcing and contingencies
Starting with a milestone plan, learn how to build a task network. From this we can calculate the expected duration of the project and the critical path. However we must allow for all the non-project things people have to do, plus making sure on-one is expected to do two jobs at once. Therefore we need techniques to devise a realistic, not a theoretically plan.
You will learn:
- What is resourcing in a project.
- How to allow for non-project activities in a project.
- What are the labour requirements for a project.
- How to work out the staff requirements for a project.
- How to deal with resourcing conflicts in a project.
- How to smooth out the resourcing of a project.
- How to do resource levelling in a project.
- How to apply contingency in a project.