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David Kohrell: A Simple Matter of Estimates – Analogous to PERT

Schedule (Activity Duration or Activity Resource) and Cost estimating are two lynch pins for business analysis and project management. The most common estimating techniques are: analogous, bottom-up, parametric and three-point – PERT.

For those pursuing a CBAP® or PMP® how to use those techniques and whether they are mutually exclusive can become a bit confusing. Hundreds of exam banks for the PMP® exam often seem to force a PMBOK® based exclusion (see Sections 6.3, 6.4 and 7.1). That is not accurate. The estimates for schedule and cost are in practice used together and also not presented as mutually exclusive on the PMP exam.

Now for a quick review of how the four estimate types might work together. Let’s use a swim meet as an example.

Analogous estimate – just like the root word analogy implies, analogous estimates are based on a previous project(s) within the organization. This estimate is often the earliest and most convenient one to gather. Because of that it is often used to justify a project and for project chartering. Example when I help conduct a swim meet we have an intuitive sense of how long a meet will take depending on total number of swimmers and events. My role is whatever is needed and most often starter, referee or stroke and turn judge.  For a meet we conducted on Saturday 8, 2011, based on 210 swimmers for over 70 events with a 20 minute break, our analogous estimate was that meet would take from 8:30 a.m. to 3:45 p.m (7 hours 15 minutes). The meet officials were a bit nervous when official entries received by the preceding Wednesday were 50 more than anticipated. So our analogous estimate that had been 8:30 a.m. to 2:00pm (5 hours, 30 minutes) was revised upward. Adding to our anxiety was the threat of winter storm (two teams were traveling over 50 miles).

Swimmers, cats and all sorts of resources that can be challenging to a project manager![/caption]

Bottom-up estimate – this estimate gathers cost or schedule from the resources or subject matter experts (SME) involved in performing the activity. The idea is rooted in quality management – those that do the work really have the best idea of what is involved.Using the swim meet example again, we ask coaches, those that help line up the swimmers (clerk of the course), time (timers), judge and officiate how long each stroke (free, back, breast, butter fly, individual medley and relays) might take and then use those estimates alongside seeded times for each swimmer to create a schedule. For that Saturday meet – our bottom up estimate was 8:30 am to 2:52 p.m.

Parametric estimate– this estimate looks at aggregate estimates from across an industry. A treasured pocket-book of mine is the Wilson’s pocket estimator (circa 1985). It’s full of construction estimates for time and resource load, from plumbing to drywall. I used it for estimating paint jobs during my undergraduate work. Visiting the swim meet example. the USA Swim Association and YMCA swim governance offer guidance for indoor and open water swim meets. For that Saturday meet the YMCA swim guide estimate was 8:30 to 3:30 p.m.

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Three-point/ PERT (program evaluation and review technique) – this estimate typically is used with the other three techniques to develop a pessimistic, most likely and optimistic schedule per activity. We did not apply this to every activity (event/heat) for the meet. I did do a quick three-point for the 25 yard events (where timers move from one side of the pool to the other). The timer travel time took anywhere from 90 seconds to 4 minutes (quite a range) with the most likely or mean travel time of 3 minutes 10 seconds. My quick 3-point estimate was 2 minutes 53 seconds.

SWIM MEET Actual – the meet went from 8:30am to 3:18 p.m or within the estimate range. The meet was ahead of the bottom-up schedule in the early morning due to combining two 500 yard events into one. The meet fell behind the bottom-up schedule in the late morning as the 25 yard events were conducted (a dummy activity or lag for timer travel time was not entered).

So what? As you incorporate the estimating techniques, incorporate all four if possible. Analogous and Parametric estimates are found by asking someone in your organization (analogous). Nimble use of “Google” will help you find your industry’s Parametric estimates (e.g. COCOMO for software development or Wilson’s estimator for construction). Bottom-up involves talking with key resources and getting a sense of who will perform that activity for your project (for example a new team member will not produce as quickly as a 7 year SME). Finally, three-Point / PERT can be used selectively for higher risk activities or ones that you want that second look.

David Kohrell, PMP®, CBAP®, CISA®, CSSBB®

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