Skip to content
Go back

The Process of Project Estimation

Project estimation isn’t an exact science, that’s for sure. And just like the football quarterback who can read defenses quickly – you either have it or you don’t. You can fake it till you make it often, but it can be painful getting there and you may lose a project or two along the way.

What I’ve always found to be helpful – at least in terms of all the IT/technical projects I’ve managed – is to have a background that gives you a good insight into the work being done. My background is technical – I used to be an application developer (programmer) as well as a manager of application developers. That has a definitely served me well when estimating project work such as the entire project, testing work, and project change order work that comes up from time to time.

If you don’t have this ability, then surround yourself with trusted team members who can give you solid estimates on your projects or make alliances with colleagues who can do this. Favors are OK things to call in when needed.

I’d like to discuss some common mistakes that project managers and team members make when estimating work on projects. To be exact, I’d like to discuss the following 9 potential mistakes that any project manager can make.

Top Project Estimation Mistakes

  1. Poor or incomplete requirements
  2. Pressure from management
  3. Not considering risks
  4. Too much optimism
  5. Omitting key information
  6. Miscommunication between estimator and implementer
  7. Estimate padding
  8. Not enough time
  9. Failure to ask the right person

1. Poor or incomplete requirements.

If the requirements are not detailed enough or the scope of work is poorly laid out, then it’s nearly impossible to provide an accurate estimate. You can try, but estimating the unknown is extremely difficult and you’re usually setting yourself and the project up for failure. Go back and put more detail into the requirements before putting together a detailed estimate that you’re going to sign your name to.

Tip: It can be easier to start from the bottom. Tasks are the smallest units of projects and we have some tips on estimating task duration more accurately.

2. Pressure from management.

Never, never, never back into an estimate based on difficult targets and timeframes that senior management hands down to you. Depending on the organization, I’ve seen this happen rarely to a lot. It’s a toxic workplace practice that needs to be put an end to. Be careful and push back when possible. That said, if you are forced into this situation, be sure to let them know that there is a risk factor in that estimate and you’re not comfortable with it. It saves your job if things go horribly wrong, but you need to let them know so they can make more informed decisions going forward.

3. Not considering risks.

Uncertainty and risk must be taken into account. I’ve never had a project or a change order that didn’t have at least some degree of risk and uncertainty. Always revisit risks when estimating project work and be sure to factor that into your estimate based on the likelihood a particular risk event could happen. It isn’t easy, but it is necessary. And make it a meaningful factor, not a standard factor you plug into every estimate you create.

4. Too much optimism.

When the estimate you make or receive is based on truly best case scenarios across the board, then your chances of meeting that estimate are slim or at least are definitely at a big risk. You would not make a household budget based on everything going perfectly all the time with no risk of an appliance breakdown or a car repair, would you? Right. So don’t do it here. Issues arise. Risks are realized. Don’t go overboard accommodating the risks and potential issues, but make the estimate realistic.

5. Omitting key information.

This isn’t really just a lack of detail – it’s the lack of elements that need to be estimated. Like the architect who designed a library and then wondered why every year the completed library was sinking a few inches. He forgot to account for the weight of the books. Omission can end up being catastrophic. Make sure you have all the details and have accounted for them in your estimate.

6. Miscommunication between estimator and implementer.

This one merely means the estimator and work-implementer are not the same person and do not possess the same skills and experience. The estimate runs the risk of being way off the mark if the skills of the task performer are either overestimated or underestimated. It’s really best to involve the actual implementer in the estimating process whenever possible. Communication is key!

7. Estimate padding.

The act of padding is when the individual providing the estimate (who is often also the person that will be performing the work) includes a fudge factor or safety range without your knowledge. This cushion is meant to ensure that he will meet his estimate or even beat it. It’s designed to make him look good, but it leaves you with an inaccurate estimate.

8. Not enough time.

When pushed for an estimate on the spot it’s extremely difficult to provide something truly usable. A good estimate needs some thought and analysis. The danger is the request for a ballpark estimate that is later included in a final estimate that you are now held to. Beware.

Tip: Start tracking how long tasks take now. That way you’ll have an accurate metric to compare future projects to. See some time tracking tips here.

9. Failure to ask the right person.

Finally, it’s just plain good practice to include the actual programmer or implementer in the act of estimating their work. This is different from the miscommunication one above – that one is
considering that those two individuals are on different skill levels and there can be misunderstandings.

Here I’m more concerned with the project manager who creates an entire change order of key work and presents it to the project client without ever involving his lead developer on the project. That’s a critical misstep and can lead to problems with price, the work, and possibly customer satisfaction. Involve the right people in the estimating process – that’s how you’re going to get your most accurate estimate. Handing down an estimate that they have no input to is a recipe for failure. Not only is it likely inaccurate, but the task performer may also resent being forced to adhere to an estimate of their work that they have no ownership of.

Put an End to Project Estimation Mistakes

Ganttic is software for resource planning and project estimation.

For project managers to be successful, it really all boils down to communication and keeping an eye on the project’s progress along the way. That helps you compile valuable insight which you can use to make more accurate predictions. Keeping this information contained in a central database is key. So using software for project estimation can help save time and your projects from an unfortunate demise.

Ganttic is project management software for resource planning and portfolio management. It will help you get a handle on the present and the future. So you don’t head in blindly.

This is a guest post from Brad Egeland who is an IT/Project Management consultant and author with over 25 years of experience. Brad is married, a father of 9, and living in sunny Las Vegas, NV.

Easier project estimations with Ganttic.