Before you start making a schedule for aProject, you need to know the estimated duration of all activities in a project. Project management frameworks such as PMI's PMBOK include various tools and techniques for estimating duration. The estimated time to complete an activity is the basis for developing the project plan. It can also serve as an entranceestimated costsof an activity, depending on the type of activity and the estimation method.
In this article, we introduce the concept of activity duration estimation, the tools and techniques, and typical applications in project management.
- What are activity duration estimates?
- What is the basis of the estimates (duration)?
- How is activity duration estimated?
- tools and techniques
- Overview of estimation methods
- Opinion of an 'expert
- analog estimation
- parametric estimation
- Three point estimate
- bottom-up estimate
- Formulas and Calculations
- How are activity durations used in project management?
- How can the activity duration be reduced?
What are activity duration estimates?
The purpose of activity duration estimation is to determine the amount of time required to complete an activity. Estimating the duration of activities is aProceedingsProject schedule managementarea of knowledgeaccording to the PMI Project Management Fundamentals Guide (PMBOK®, 6IsEd., Chap. 6.4).
That's itProceedingsrequires several input parameters, including in particular the scope of the work and the list and characteristics of the planned activities, as well as the resources that will be mobilized to carry out the work.
The PMBOK lists
- expert opinions,
- analog estimation,
- parametric estimation,
- Bottom-up estimation and
- Three point estimate
as techniques for determining duration estimates. Read on for an overview of these estimation techniques.
Estimation of duration is typically done at the activity level (see figure below). Determining the total duration of a work package or the entire project requires planning the activities considering their individual duration.
This involves considering dependencies between activities and typically developing a critical path (the longest chain of activities to achieve the desired outcome). Therefore, it is generally not necessary to calculate the sum of activity durations when determining the duration of work packages or entire projects. This is because the sum of activity durations can overestimate (sometimes underestimate) the total time to complete a project, since some activities can run in parallel while others depend on the completion of a previous activity.
What is the basis of the estimates (duration)?
The estimates are based on a documented set of assumptions and constraints underlying the duration estimate. This document also describes the methods used to produce an estimate, the range of possible outcomes, and the confidence in the estimate(s).
This documentation is important in projects for several reasons. It makes transparent which restrictions and assumptions were taken into account in the estimation. As soon as an assumption is no longer valid, this can trigger the need for a new estimate. A project manager can also use these documents to ensure consistency between different activities in a project, as a justification for the project plan and for theCommunication with stakeholders.
How is activity duration estimated?
treasureProceedingsIt requires some input information and documents, and involves the use of one or more estimation techniques. The following subsections explain these requirements.
Estimating the duration of the job should generally be done by the person most familiar with the nature of the job. This is all the more important when using an estimation technique based on the knowledge and experience of the estimator(s) rather than historical data.
The result of duration estimates is always a number of time periods (e.g. days, weeks, months;Those). The level of confidence and whether it is a single estimate or a range depends on the estimation technique used.
Regardless of the estimation technique, it is good practice to accompany the estimated number with a document that outlines any underlying assumptions and limitations, the estimation ranges, and the expected level of accuracy. In PMI terminology, this document is referred to as the Basis of Estimates.
IsPMBOKlists a set of grouped entries from the organization's project management plan, project documents, business environmental factors, and process assets. While knowing the full list is probably relevant for project management reviews (you can find it in PMBOK chapter 6.4.2), an estimate can be made with the following minimal input parameters:
- list of activities and their attributes,
- allocated resources (materials and staff, including availability and skills) and
- historical data (for some estimation methods).
The more information you can consider, such as a risk register or business environment factors, the better your estimates will be.
tools and techniques
The following table summarizes the most common estimation techniques, which are also included in the PMBOK.
Follow the links in the "References" row of the table to learn more about each method (including examples). You can also use oursProject Management Calculatorcalculate final duration estimates.
Overview of estimation methods
|Opinion of an 'expert||analog estimation||parametric estimation||bottom-up estimate||Three point estimate|
|input data||specialist knowledge and experience.||Historical or market data: Values of previous similar projects||Historical or market data: parameters and values of similar projects||Scope of work, activities.||technical budget|
|Method||Experts estimate the time required to complete the work at scale, either as a top-down or bottom-up estimate.||Acquisition and adjustment of historical duration observations for similar types of activities (top-down)||Using historical durations per parameter unit to determine the expected duration of future activities||Estimate duration at a granular level (e.g. activities or less) and aggregate at higher levels||Three-point duration estimates consist of optimistic, pessimistic, and most likely estimates. Can be converted to final estimates with a triangular or PERT/Beta distribution|
|output type||Several||Estimated duration of an activity||Estimated duration of an activity||Estimated duration of an activity||Estimates of the final duration of the activities*, standard deviations of the estimates|
|references||PMBOK®, Ch. 22.214.171.124, Ch. 126.96.36.199||PMBOK®, Cap. 188.8.131.52Article incl. For example;5 step guide||PMBOK®, Cap. 184.108.40.206|
Article incl. For example
|PMBOK®, Cap. 220.127.116.11,|
Article incl. For example
|PMBOK®, Cap. 18.104.22.168;Article|
*The PERT method can also be used to plan various activities, which are beyond the scope of this article.
Per PMI estimates are subject to activity durationprogressive elaboration. This implies that they could be quietrough estimatesin the first planning phase of the project. As the project progresses, they will be improved and more accurate as more information and details are known.
Opinion of an 'expert
Expert appraisal means that an appraiser or group of appraisers determines the expected duration of an activity based on their experience and knowledge in the relevant field.
The accuracy of these types of estimates can vary widely. It depends on the characteristics of the work and the experience of the specialists.
Expert judgment can also be used to complement one of the other types of estimation, for example in cases where historical data is only applicable to parts of the work.
analog estimationIt is a technique that uses historical data or the experience of estimators to determine the expected duration of an activity. Also known as a top-down estimate.
Continue readingDetails and an example here.
The parametric estimation technique uses historical data and statistical approaches to predict the duration of planned activities.
This can be one of the most accurate methods when data availability, quality, and statistical correlations are strong. However, the estimation may require some efforts and resources.
You will find moreExplanations and an example in this article.
Three point estimate
As the name suggests, this technique requires the determination of three different duration estimates:
- an optimist,
- pessimistic u
- a "most likely" estimate.
It can be used as a range estimate or further processed, e.g. Percalculate a final estimateusing aTriangular or Pert distribution.
Since duration estimation relates to activities, the bottom-up estimation technique is implicitly the main approach to activity duration. Activities are often the most detailed planning component of a project. But activities can also be broken down, e.g. into steps or procedures to increase the accuracy of an estimate.
The technique suggests that those responsible for performing the work also value the duration of that work.
For the project cost estimate, granular estimates are aggregated to arrive at the total cost estimate for the entire project. However, this is more complex for the project schedule. It actually requires some programming techniques to account for the interdependencies of activities and the options for activities running in parallel.
You can read more belowthis guide to bottom-up estimation(including examples).
Formulas and Calculations
The above estimation techniques have their own form of calculation. Parametric estimation requires statistical correlation and subsequent computation (from the rule of three to complex statistical models). appraisal andanalog estimationThey are usually done without calculations.
When one refers to the "permanent estimation formula," one often thinks of thatThree point estimateMethod.
Assuming a triangular distribution of the three estimates, the calculation of the final estimate is:
mi = (O + M + P) / 3
E = amount of expected time using the three-point estimate,
O = Optimistic estimate of duration,
M = estimate of the most likely duration,
P = Pessimistic long-term estimate.
An alternative to this triangular calculation is the Pert method. you will find oneComparison of both approaches in this article.
Keep in mind that the three-point estimate is just one of several methods that can be used to predict duration. Read the previous sections and in-depth articles to become familiar with the other techniques.
How are activity durations used in project management?
Activity durations are important information in project management. They are the basis for creating the project schedule and help determine the time it takes to complete the deliverables. When the critical path technique is used to develop the overall schedule, the estimates of duration for activities that are part of the critical path directly affect the schedule for the entire project. Therefore, a high level of accuracy is recommended for the duration estimates associated with these activities (Those).
Activity-level duration estimates also help test whether the work can be performed under certain constraints. For example, a project typically has a predefined completion date and set of deliverables. The project is then broken down into the activity level, where resources are also estimated and allocated. Estimating the duration of the activities involves checking whether the combination of allocated resources, expected outcomes and other constraints is feasible.
Because duration estimates relate to activities, you need to use more planning techniques to determine the duration of the entire project. Activity duration estimates are an input to these methods.
The duration of the activities can also serve as a basis for cost estimates. This is the case when costs are determined as the product of time and resource costs per unit time. This is a common approachCost estimate from the bottom up, For example.
How can the activity duration be reduced?
There are several ways to reduce the time it takes to complete activities. The different approaches can be divided into three categories:
- Delimitation of the scope of work of an activity,
- Increase the amount or number of resources for that activity and
- Increase work efficiency.
Activities are usually planned after completion of the work breakdown structure. Each activity is linked to a work package that must produce a deliverable or part of a deliverable.
Therefore, changes in girth would be a fairly drastic step when estimating activity duration. However, estimating duration can help change steps and procedures between activities when doing so increases overall productivity and therefore decreases duration.
There are also many other ways to increase efficiency, which can include automation of work, higher skill level of resources, improved work environment (e.g. co-location), optimization of material and product sourcing, better quality assurance, among others. etc.
A common way to reduce the duration of activities is to increase the number of resources allocated to an activity. This is particularly common in labor-intensive types of work.
In practice, there are certain limitations on the effect of such measures. New team members must have an appropriate skill level. They would also need some integration, which would take away from other members' time to do their own work.
The PMBOK also lists the law of diminishing returns, which means that the additional (marginal) productivity gain decreases with each new resource added.
Estimating the duration of activities is critical to creating a project plan. It can also serve as a test of general assumptions in the early stages of a project. In this way, the need for adjustment (e.g. resource allocation) can be made transparent.
The techniques used for duration estimation are also applicable toEstimated costs, and PMBOK regularly refers to the two chapters.
If you arePreparation for the PMP examTherefore, you should familiarize yourself with these methods.
What is activity duration estimation in project management? ›
Activity duration estimating is the process of taking information on project scope and resources and then developing durations for input to schedules. The inputs for estimates of duration typically originate from the person or group on the project team who is most familiar with the nature of a specific activity.Which is the most common method for estimating durations for activities in project? ›
The Parametric estimating technique makes use of historical data and statistical approaches to predict the durations of planned activities. This can be one of the most accurate methods if the data availability, quality and statistical correlations are strong.What are the 2 ways of estimating activity time in project management? ›
The project manager can then convert these numbers into a final estimate using either a triangular or PERT/Beta distribution method.What are the 4 project estimation steps? ›
- Top-down estimate. ...
- Bottom-up estimate. ...
- Expert judgment. ...
- Comparative or analogous estimation. ...
- Parametric model estimating. ...
- Three-point estimating.
- Top-down estimation. ...
- Bottom-up estimation. ...
- Three-point estimation. ...
- Analogous estimation. ...
- Parametric estimation. ...
- Expert judgment.
Three types of estimates: Ballpark, budgetary, and definitive.What are the five 5 main stages of an estimate? ›
- Order of Magnitude.
- Schematic Design Estimate.
- Preliminary Estimate.
- Construction Document Estimate.
- Bid Estimate.
Specific examples of project management methodologies – each with its unique advantages and limitations – include, but are not limited to Agile, Waterfall, Critical Path, Scrum, Lean Six Sigma and PRINCE2.What are the seven 7 processes of project time management? ›
- Plan Schedule Management (Planning process)
- Define Activities (Planning process)
- Sequence Activities (Planning process)
- Estimate Activity Resources (Planning process)
- Estimate Activity Durations (Planning process)
- Develop Schedule (Planning process)
- Bottom-up estimating.
- Analogous estimating.
- Parametric estimating.
- Alternatives analysis.
- Project management information system (PMIS)
- Expert judgment.
Which technique is used for project estimation? ›
While accurate estimates are the basis of sound project planning, there are many techniques used as project management best practices in estimation as - Analogous estimation, Parametric estimation, Delphi method, 3 Point Estimate, Expert Judgment, Published Data Estimates, Vendor Bid Analysis, Reserve Analysis, Bottom- ...Which of the three types of estimating methods is most accurate? ›
In fact, bottom-up estimates are the most accurate type of cost estimate.
Activity based estimation focus on key activities should not be left out and if any effort variance occurs it will be possible to track at particular activity level rather than affecting the entire activities.What are the 5 stages of project management? ›
- monitoring and control.
According to the PMBOK Guide (Project Management Body of Knowledge) by the Project Management Institute (PMI), a project management life cycle consists of 5 distinct phases including initiation, planning, execution, monitoring, and closure that combine to turn a project idea into a working product.What are the 4 main processes of project management? ›
Whether you're in charge of developing a website, designing a car, moving a department to a new facility, updating an information system, or just about any other project (large or small), you'll go through the same four phases of project management: planning, build-up, implementation, and closeout.What are the 4 types of estimating? ›
- Preliminary estimate.
- Detailed estimate.
- Quantity estimate.
- Bid estimate.
- Cost estimates.
- Expert judgement. If the project team is experienced in delivering the type of work in the scope, they can use their specialised knowledge to estimate costs. ...
- Analogous estimate. ...
- 3-point estimate. ...
- Parametric estimate. ...
- Bottom-up estimate.
- Step 1: Establish estimate scope and purpose. ...
- Step 2: Establish technical baseline, ground rules, and assumptions. ...
- Step 3: Collect data. ...
- Step 4: Determine size and scope. ...
- Step 5: Prepare baseline estimate. ...
- Step 6: Quantify risks and risk analysis. ...
- Step 7: Validate and review.
The three types of cost estimates are design, bid, and control estimates. Design estimates are prepared in the project preliminaries which gives the order of magnitude of the project cost. Bid estimates are used in the tendering phase of the project which details project overheads and other indirect costs.
What are three main components of estimate? ›
In spite of the many types of cost estimates used at different stages of a project, cost estimates can best be classified into three major categories according to their functions. A construction cost estimate serves one of the three basic functions: design, bid and control.What are the six steps in cost estimation? ›
- Agree on estimating basis. ...
- Collect scope documentation. ...
- Estimate direct cost. ...
- Estimate other costs and apply factors, indexation and escalation. ...
- Peer review. ...
- Finalize basis of estimate report and send estimate for approval.
- Understand what's required.
- Prioritize activities and tasks.
- Decide who you need to involve.
- Do your estimates.
- Project Integration Management. ...
- Project Scope Management. ...
- Project Time Management. ...
- Project Cost Management. ...
- Project Quality Management. ...
- Project Human Resource Management. ...
- Project Communication Management. ...
- Project Risk Management.
- Developing a Project Charter. The project charter plays a pivotal role in Project Integration Management. ...
- Developing a Project Plan. ...
- Directing and Managing a Project Work. ...
- Monitoring and Controlling a Project Work. ...
- Performing Integrated Change Control. ...
- Close Phase.
- define the project.
- list the tasks.
- estimate the cost and time of each task.
- plan the dependencies and longest route.
- speed up the project plan if necessary.
- create a Gantt chart (I love Gantt charts)
- check you have the resources required.
- think about risk.
There are seven core elements that if considered will contribute to the organization's project decision-making process. The seven elements (7 C's) are: customers, competitors, capabilities, cost, channels, communication, and coordination.What are the 8 elements of project plan? ›
- The Identification of Stakeholder Needs. ...
- Smart Project Objectives. ...
- Clear Project Deliverables and Timelines. ...
- A Detailed Project Schedule. ...
- Defined Roles and Responsibilities. ...
- Project Costs That Help Identify Shortfalls.
- Expert Judgment. ...
- Analogous Estimation. ...
- Parametric Estimating. ...
- Alternative Analysis. ...
- Published Estimating Data. ...
- Vendor Bid Analysis.
Estimate costs is one of the most important processes in project management. Expert judgment, analogous estimation, three-point estimation, parametric estimation, and bottom-up estimation are the techniques used in this process.
What is estimate activity resources in PMP? ›
This is a process where you look at each individual activity and determine what and how many resources are needed to accomplish that activity. Resources are not just people, but also include equipment, machines, and different types of supplies needed to finish the activity.Which is the best estimation method? ›
- Factor estimating. The first and most high-level technique available is factor estimating. ...
- Parametric estimating. Often, companies possess a lot of historical project information that sits unused. ...
- Quantitative factor estimating. ...
- Unit-Rate estimating. ...
Project estimation is the process of forecasting the time, cost, and resources needed to deliver a project. It typically happens during project initiation and/or planning and takes the project's scope, deadlines, and potential risks into account.What is three point estimation in agile? ›
In three-point estimation, three figures are produced initially for every distribution that is required, based on prior experience or best-guesses: a = the best-case estimate. m = the most likely estimate. b = the worst-case estimate.What is activity duration in PERT? ›
To perform PERT analysis, you need to provide three estimates of activity duration: a pessimistic estimate (tp), an optimistic estimate (to), and a modal estimate (tm). These three estimates are used to obtain a weighted average that is assumed to be a reasonable estimate of the activity duration.