Top-down vs bottom-up estimations - Revision history

OliVittrup at 07:31, 28 February 2021

2021-02-28T07:31:06Z

← Older revision		Revision as of 07:31, 28 February 2021
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	The term 'estimating' in terms of project management can be defined as "''the process of predicting the cost and time needed to deliver project products''". <ref name="study">		The term 'estimating' in terms of project management can be defined as "''the process of predicting the cost and time needed to deliver project products''". <ref name="study">
	Bugajenko, O. Top-Down & Bottom-Up Estimating Techniques in Project Management. [online] Available at: https://study.com/academy/lesson/top-down-bottom-up-estimating-techniques-in-project-management.html [Accessed February 18th 2021].</ref> The estimation part is an important step on the way ~~to a get~~ a good product, which satisfies the costumer and/or the user, when it is delivered in the end. The estimation ~~proces~~ is used in order to predict the cost and the duration of a given project, which is making it possible to make the decisions, which will benefit the project. When estimating, it is also possible to make a decision regarding the viability of the project, when the financial requirements has been determined. <br />		Bugajenko, O. Top-Down & Bottom-Up Estimating Techniques in Project Management. [online] Available at: https://study.com/academy/lesson/top-down-bottom-up-estimating-techniques-in-project-management.html [Accessed February 18th 2021].</ref> The estimation part is an important step on the way of getting a good product, which satisfies the costumer and/or the user, when it is delivered in the end. The estimation process is used in order to predict the cost and the duration of a given project, which is making it possible to make the decisions, which will benefit the project. When estimating, it is also possible to make a decision regarding the viability of the project, when the financial requirements has been determined. <br />
	The duration of a project is important to know in regards to costumer expectations and in order to know when the product can be delivered. From the estimation process, the project manager can use the determined time frames for time scheduling, which is relevant informations for interested stakeholders. During the project, the project manager can hold the real time data up against the estimated values in order to monitor the performance of the project. <ref name="study"/> <br />		The duration of a project is important to know in regards to costumer expectations and in order to know when the product can be delivered. From the estimation process, the project manager can use the determined time frames for time scheduling, which is relevant informations for interested stakeholders. During the project, the project manager can hold the real time data up against the estimated values in order to monitor the performance of the project. <ref name="study"/> <br />
	Project estimations can be a fast task, but it can also be very time consuming. This all comes down to how the project manager wishes to prioritize the estimation, and is a decision on whether the time used on estimating is worth the effort in the end. The estimation process can be carried out by using top-down estimating as well as the bottom-up estimating.		Project estimations can be a fast task, but it can also be very time consuming. This all comes down to how the project manager wishes to prioritize the estimation, and is a decision on whether the time used on estimating is worth the effort in the end. The estimation process can be carried out by using top-down estimating as well as the bottom-up estimating.
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	<br />		<br />
	'''Ratio estimate''' <br />		'''Ratio estimate''' <br />
	A ratio estimate compares the new project to a reference project with enough similarities. The two projects are then compared in regards to size, which gives a ratio between them. As an example, the project estimators, would believe that the new project would take 130% of the reference project.<ref name="projectmanagementinfo2"/>. ~~A visual example of the ratio estimation technique can be seen from the following figure.~~<br />		A ratio estimate compares the new project to a reference project with enough similarities. The two projects are then compared in regards to size, which gives a ratio between them. As an example, the project estimators would believe that the new project would take 130% of the reference project, which increases the cost, duration and need for resources following this ratio.<ref name="projectmanagementinfo2"/>. <br />
	<br />		<br />
	'''Estimate range''' <br />		'''Estimate range''' <br />
	An estimate range shows the price range between a series of earlier performed projects similar to the new project planned. The estimate range is then going from the cheapest project up to the most expensive. The estimate range would often be made with a 'most likely'-estimate.<ref name="projectmanagementinfo2"/>		An estimate range shows the price range between a series of earlier performed projects similar to the new project planned. The estimate range is then going from the cheapest project up to the most expensive. The estimate range would often be made with a 'most likely'-estimate.<ref name="projectmanagementinfo2"/> A visual example of the estimate range can be seen from the following figure.
	[[File:Estimation-range.png\|700px\|thumb\|center\|Example of an 'Estimate range'. Inspired by figure found at https://project-management.info/analogous-estimating/]]		[[File:Estimation-range.png\|700px\|thumb\|center\|Example of an 'Estimate range'. Inspired by figure found at https://project-management.info/analogous-estimating/]]
	<br />		<br />

Kendra: /* Big idea */

2021-02-27T11:11:35Z

Big idea

← Older revision		Revision as of 11:11, 27 February 2021
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	The bottom-up estimating approach is to be used, when a detailed estimate is needed for the project. By using the bottom-up estimation, the project cost and duration is estimated on a task specific level, allowing the project manager to plan each and every task. The task costs and durations can then be aggregated in the end, which will result in a very detailed project estimate. This approach also makes it possible to estimate the amount of resources needed for the project. <ref name="projectmanagementinfo1"> Sebastian. Bottom Up Estimating. Definition, Examples, Pros & Cons. [online] Available at: https://project-management.info/bottom-up-estimating-definition-example-pros-cons/ [Accessed February 18th 2021].</ref> <br />		The bottom-up estimating approach is to be used, when a detailed estimate is needed for the project. By using the bottom-up estimation, the project cost and duration is estimated on a task specific level, allowing the project manager to plan each and every task. The task costs and durations can then be aggregated in the end, which will result in a very detailed project estimate. This approach also makes it possible to estimate the amount of resources needed for the project. <ref name="projectmanagementinfo1"> Sebastian. Bottom Up Estimating. Definition, Examples, Pros & Cons. [online] Available at: https://project-management.info/bottom-up-estimating-definition-example-pros-cons/ [Accessed February 18th 2021].</ref> <br />

	The big differences between the to estimation techniques is that the top-down estimating can be used for any level of of the project phase, even when information may be limited. On the other hand, it is fairly common that the bottom-up approach is used, when a lot of knowledge has been obtained about the project.		The big differences between the to estimation techniques is that the top-down estimating can be used for any level of of the project phase, even when information may be limited. On the other hand, it is fairly common that the bottom-up approach is used, when a lot of knowledge has been obtained about the project.

	== Application ==		== Application ==

OliVittrup at 11:06, 27 February 2021

2021-02-27T11:06:53Z

← Older revision		Revision as of 11:06, 27 February 2021
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	The bottom-up estimating approach is to be used, when a detailed estimate is needed for the project. By using the bottom-up estimation, the project cost and duration is estimated on a task specific level, allowing the project manager to plan each and every task. The task costs and durations can then be aggregated in the end, which will result in a very detailed project estimate. This approach also makes it possible to estimate the amount of resources needed for the project. <ref name="projectmanagementinfo1"> Sebastian. Bottom Up Estimating. Definition, Examples, Pros & Cons. [online] Available at: https://project-management.info/bottom-up-estimating-definition-example-pros-cons/ [Accessed February 18th 2021].</ref> <br />		The bottom-up estimating approach is to be used, when a detailed estimate is needed for the project. By using the bottom-up estimation, the project cost and duration is estimated on a task specific level, allowing the project manager to plan each and every task. The task costs and durations can then be aggregated in the end, which will result in a very detailed project estimate. This approach also makes it possible to estimate the amount of resources needed for the project. <ref name="projectmanagementinfo1"> Sebastian. Bottom Up Estimating. Definition, Examples, Pros & Cons. [online] Available at: https://project-management.info/bottom-up-estimating-definition-example-pros-cons/ [Accessed February 18th 2021].</ref> <br />

	The bottom-up estimating is performed at the lowest level with-in the 'Work breakdown structure', which is where all of the activities within a given project has been named and listed. An example of this can be seen from the following figure.

	~~[[File:Bottom-up-estimating.png\|800px\|thumb\|center\|Example of bottom-up estimating. Inspired by figure found at https://project-management.info/bottom-up-estimating-definition-example-pros-cons/]]~~

	The big differences between the to estimation techniques is that the top-down estimating can be used for any level of of the project phase, even when information may be limited. On the other hand, it is fairly common that the bottom-up approach is used, when a lot of knowledge has been obtained about the project.		The big differences between the to estimation techniques is that the top-down estimating can be used for any level of of the project phase, even when information may be limited. On the other hand, it is fairly common that the bottom-up approach is used, when a lot of knowledge has been obtained about the project.
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	The bottom-up estimating technique should be put into work when the project is in a place, where it needs accurate predictions regarding future. This can be, as shown in the bulletpoints, in regards to duration, cost and resources. <br />		The bottom-up estimating technique should be put into work when the project is in a place, where it needs accurate predictions regarding future. This can be, as shown in the bulletpoints, in regards to duration, cost and resources. <br />
	The different estimates can also depend on each other. The task duration will often depend on the resources, which has been assigned to the specific task. The cost is estimated from the time- and resource estimates by multiplying them with the price per unit.<ref name="projectmanagementinfo1"/> This is differentiated from company to company. <br />		The different estimates can also depend on each other. The task duration will often depend on the resources, which has been assigned to the specific task. The cost is estimated from the time- and resource estimates by multiplying them with the price per unit.<ref name="projectmanagementinfo1"/> This is differentiated from company to company. <br />
			The bottom-up estimating is performed at the lowest level with-in the 'Work breakdown structure', which is where all of the activities within a given project has been named and listed. An example of this can be seen from the following figure.

			[[File:Bottom-up-estimating.png\|800px\|thumb\|center\|Example of bottom-up estimating. Inspired by figure found at https://project-management.info/bottom-up-estimating-definition-example-pros-cons/]]

	== Limitations ==		== Limitations ==

OliVittrup at 10:58, 27 February 2021

2021-02-27T10:58:01Z

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	* the project manager needs to see the big picture and an accurate estimate is not needed		* the project manager needs to see the big picture and an accurate estimate is not needed

	The top-down estimating can be used as a starting point for the bottom-up estimate. This gives a quick introduction to the project, which if needed, can be analyzed further. The technique works best and gives the most reliable estimates, when the project is similar to an earlier finished project, and the assumptions regarding the similarities is correct.<ref name="projectmanagementinfo2"/> As mentioned earlier, the top-down estimation can be performed in four different ways, which will be briefly described		The top-down estimating can be used as a starting point for the bottom-up estimate. This gives a quick introduction to the project, which if needed, can be analyzed further. The technique works best and gives the most reliable estimates, when the project is similar to an earlier finished project, and the assumptions regarding the similarities is correct.<ref name="projectmanagementinfo2"/> As mentioned earlier, the top-down estimation can be performed in four different ways, which will be briefly described. <br />
			<br />
			'''Single-point estimate''' <br />
			This technique within the top-down estimation, defines the way of estimating the project from the most similar project performed earlier. Therefore, the project is analyzed and compared to projects in the same category as itself, and then estimated on the background of the most similar one. If the reference project cost 500.000 DKK, the top-down estimate for the new project would then be similar equal to 500.000 DKK.<ref name="projectmanagementinfo2"/>. A visual example of the single-point estimation technique can be seen from the following figure.

	'''Single-point estimate'''		[[File:One-Point-Estimate.png\|700px\|thumb\|center\|Example of a 'Single-point estimation'. Inspired by figure found at https://project-management.info/analogous-estimating/]]
	~~This technique within the top-down estimation, defines the way of estimating~~ the project ~~from the most similar~~ project ~~performed earlier~~. ~~Therefore~~, the project ~~is analyzed and compared to projects in the same category as itself~~, ~~and then estimated on~~ the ~~background~~ of ~~the most similar one. If~~ the reference project ~~cost 500~~.~~000 DKK,~~ the ~~top-down~~ estimate ~~for~~ the new project ~~would~~ then ~~be similar equal~~ to ~~500~~.~~000 DKK~~.<ref name="projectmanagementinfo2"/>		<br />
			'''Ratio estimate''' <br />
			A ratio estimate compares the new project to a reference project with enough similarities. The two projects are then compared in regards to size, which gives a ratio between them. As an example, the project estimators, would believe that the new project would take 130% of the reference project.<ref name="projectmanagementinfo2"/>. A visual example of the ratio estimation technique can be seen from the following figure.<br />
			<br />
			'''Estimate range''' <br />
			An estimate range shows the price range between a series of earlier performed projects similar to the new project planned. The estimate range is then going from the cheapest project up to the most expensive. The estimate range would often be made with a 'most likely'-estimate.<ref name="projectmanagementinfo2"/>
			[[File:Estimation-range.png\|700px\|thumb\|center\|Example of an 'Estimate range'. Inspired by figure found at https://project-management.info/analogous-estimating/]]
			<br />

	~~[[File:One-Point-Estimate.png\|800px\|thumb\|center\|Example of a~~ '~~Single~~-point ~~estimation~~'~~. Inspired by figure found at https://project-management.info/analogous-estimating/]]~~		'''Three-point estimate''' <br />
			This approach requires the project manager to make three estimates, which includes an optimistic estimate, a pessimistic estimate and a most likely estimate. They are then to be converted into a final estimate.<ref name="projectmanagementinfo2"/>
	* Ratio estimate
	** A ratio estimate compares the new project to a reference project with enough similarities. The two projects are then compared in regards to size, which gives a ratio between them. As an example, the project estimators, would believe that the new project would take 130% of the reference project.<ref name="projectmanagementinfo2"/>
	* Estimate range
	** An estimate range shows the price range between a series of earlier performed projects similar to the new project planned. The estimate range is then going from the cheapest project up to the most expensive. The estimate range would often be made with a '~~most likely~~'~~-estimate.~~<~~ref name="projectmanagementinfo2"~~/>
	* Three-point estimate
	** This approach requires the project manager to make three estimates, which includes an optimistic estimate, a pessimistic estimate and a most likely estimate. They are then to be converted into a final estimate.<ref name="projectmanagementinfo2"/>

	==== Bottom-up estimating ====		==== Bottom-up estimating ====

OliVittrup at 10:29, 27 February 2021

2021-02-27T10:29:59Z

← Older revision		Revision as of 10:29, 27 February 2021
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	The top-down estimating can be used as a starting point for the bottom-up estimate. This gives a quick introduction to the project, which if needed, can be analyzed further. The technique works best and gives the most reliable estimates, when the project is similar to an earlier finished project, and the assumptions regarding the similarities is correct.<ref name="projectmanagementinfo2"/> As mentioned earlier, the top-down estimation can be performed in four different ways, which will be briefly described		The top-down estimating can be used as a starting point for the bottom-up estimate. This gives a quick introduction to the project, which if needed, can be analyzed further. The technique works best and gives the most reliable estimates, when the project is similar to an earlier finished project, and the assumptions regarding the similarities is correct.<ref name="projectmanagementinfo2"/> As mentioned earlier, the top-down estimation can be performed in four different ways, which will be briefly described

	* Single-point estimate		'''Single-point estimate'''
	** This technique within the top-down estimation, defines the way of estimating the project from the most similar project performed earlier. Therefore, the project is analyzed and compared to projects in the same category as itself, and then estimated on the background of the most similar one. If the reference project cost 500.000 DKK, the top-down estimate for the new project would then be similar equal to 500.000 DKK.<ref name="projectmanagementinfo2"/>		This technique within the top-down estimation, defines the way of estimating the project from the most similar project performed earlier. Therefore, the project is analyzed and compared to projects in the same category as itself, and then estimated on the background of the most similar one. If the reference project cost 500.000 DKK, the top-down estimate for the new project would then be similar equal to 500.000 DKK.<ref name="projectmanagementinfo2"/>

			[[File:One-Point-Estimate.png\|800px\|thumb\|center\|Example of a 'Single-point estimation'. Inspired by figure found at https://project-management.info/analogous-estimating/]]

	* Ratio estimate		* Ratio estimate
	** A ratio estimate compares the new project to a reference project with enough similarities. The two projects are then compared in regards to size, which gives a ratio between them. As an example, the project estimators, would believe that the new project would take 130% of the reference project.<ref name="projectmanagementinfo2"/>		** A ratio estimate compares the new project to a reference project with enough similarities. The two projects are then compared in regards to size, which gives a ratio between them. As an example, the project estimators, would believe that the new project would take 130% of the reference project.<ref name="projectmanagementinfo2"/>

OliVittrup at 10:15, 27 February 2021

2021-02-27T10:15:15Z

← Older revision		Revision as of 10:15, 27 February 2021
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	The bottom-up estimating approach is to be used, when a detailed estimate is needed for the project. By using the bottom-up estimation, the project cost and duration is estimated on a task specific level, allowing the project manager to plan each and every task. The task costs and durations can then be aggregated in the end, which will result in a very detailed project estimate. This approach also makes it possible to estimate the amount of resources needed for the project. <ref name="projectmanagementinfo1"> Sebastian. Bottom Up Estimating. Definition, Examples, Pros & Cons. [online] Available at: https://project-management.info/bottom-up-estimating-definition-example-pros-cons/ [Accessed February 18th 2021].</ref> <br />		The bottom-up estimating approach is to be used, when a detailed estimate is needed for the project. By using the bottom-up estimation, the project cost and duration is estimated on a task specific level, allowing the project manager to plan each and every task. The task costs and durations can then be aggregated in the end, which will result in a very detailed project estimate. This approach also makes it possible to estimate the amount of resources needed for the project. <ref name="projectmanagementinfo1"> Sebastian. Bottom Up Estimating. Definition, Examples, Pros & Cons. [online] Available at: https://project-management.info/bottom-up-estimating-definition-example-pros-cons/ [Accessed February 18th 2021].</ref> <br />

	The bottom-up estimating is performed at the lowest level with-in the 'Work breakdown structure', which is where all of the activities within a given project has been named and listed.		The bottom-up estimating is performed at the lowest level with-in the 'Work breakdown structure', which is where all of the activities within a given project has been named and listed. An example of this can be seen from the following figure.

			[[File:Bottom-up-estimating.png\|800px\|thumb\|center\|Example of bottom-up estimating. Inspired by figure found at https://project-management.info/bottom-up-estimating-definition-example-pros-cons/]]

	The big differences between the to estimation techniques is that the top-down estimating can be used for any level of of the project phase, even when information may be limited. On the other hand, it is fairly common that the bottom-up approach is used, when a lot of knowledge has been obtained about the project.		The big differences between the to estimation techniques is that the top-down estimating can be used for any level of of the project phase, even when information may be limited. On the other hand, it is fairly common that the bottom-up approach is used, when a lot of knowledge has been obtained about the project.

OliVittrup at 13:04, 26 February 2021

2021-02-26T13:04:04Z

← Older revision		Revision as of 13:04, 26 February 2021
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			'' Written by Oliver K. Vittrup ''

	== Abstract ==		== Abstract ==
	When starting a new project, an important task for the project manager, is the estimation process. This can both be an estimation regarding cost and time-frames. It is important to get the project off to a good start, given that success of the project depends on the estimation - both in regards to time and cost. When estimating (or in other words 'predicting the future'), the project manager can use the following methods:		When starting a new project, an important task for the project manager, is the estimation process. This can both be an estimation regarding cost and time-frames. It is important to get the project off to a good start, given that success of the project depends on the estimation - both in regards to time and cost. When estimating (or in other words 'predicting the future'), the project manager can use the following methods:

OliVittrup at 08:41, 26 February 2021

2021-02-26T08:41:25Z

← Older revision		Revision as of 08:41, 26 February 2021
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	** An estimate range shows the price range between a series of earlier performed projects similar to the new project planned. The estimate range is then going from the cheapest project up to the most expensive. The estimate range would often be made with a 'most likely'-estimate.<ref name="projectmanagementinfo2"/>		** An estimate range shows the price range between a series of earlier performed projects similar to the new project planned. The estimate range is then going from the cheapest project up to the most expensive. The estimate range would often be made with a 'most likely'-estimate.<ref name="projectmanagementinfo2"/>
	* Three-point estimate		* Three-point estimate
	** This approach requires the project manager to make three estimates, which includes an optimistic estimate, a pessimistic estimate and a most likely estimate. They are then to be converted into a final estimate.		** This approach requires the project manager to make three estimates, which includes an optimistic estimate, a pessimistic estimate and a most likely estimate. They are then to be converted into a final estimate.<ref name="projectmanagementinfo2"/>

	==== Bottom-up estimating ====		==== Bottom-up estimating ====

OliVittrup: /* Annotated Bibliography */

2021-02-25T19:40:10Z

Annotated Bibliography

← Older revision		Revision as of 19:40, 25 February 2021
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	== Annotated Bibliography ==		== Annotated Bibliography ==

	''Provide key references (3-10), where a reader can find additional information on the subject. The article MUST make appropriate references to the and reference material provided in class – either incorporating it as a source, or critically discussing aspects that are missing from it but covered by this article. Summarize and outline the relevance of each reference to the topic (around 100 words per reference). The bibliography is not counted in the suggested 3000 word target length of the article.''		*'''project-management.info''' offers a broad palette of information within the field of project management. It also offers a more detailed description of the tools described in this article. The articles on project-management.info also shows the tool in a visual manner, which makes the theory easier to understand and use.

	*'''project-management.info''' offers a broad palette of information within the field of project management. It also offers a more detailed description of the tools described in this article.
	*'''apm.org.uk''' is the official site of the Association for Project Management. They describe their goal as "''Inspiring communities to deliver meaningful change for societal benefit by advancing the art, science, theory and practice of project management.''"		*'''apm.org.uk''' is the official site of the Association for Project Management. They describe their goal as "''Inspiring communities to deliver meaningful change for societal benefit by advancing the art, science, theory and practice of project management.''"
	*'''pmstudycircle.com''' is a website made from a student, frustrated about the missing information about project management available on the web, when he was writing his exam. Here he has gathered a lot of relevant information about project management.		*'''pmstudycircle.com''' is a website made from a student, frustrated about the missing information about project management available on the web, when he was writing his exam. Here he has gathered a lot of relevant information about project management.

	== References ==		== References ==
	<references />		<references />

OliVittrup at 19:39, 25 February 2021

2021-02-25T19:39:00Z

← Older revision		Revision as of 19:39, 25 February 2021
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	''Provide key references (3-10), where a reader can find additional information on the subject. The article MUST make appropriate references to the and reference material provided in class – either incorporating it as a source, or critically discussing aspects that are missing from it but covered by this article. Summarize and outline the relevance of each reference to the topic (around 100 words per reference). The bibliography is not counted in the suggested 3000 word target length of the article.''		''Provide key references (3-10), where a reader can find additional information on the subject. The article MUST make appropriate references to the and reference material provided in class – either incorporating it as a source, or critically discussing aspects that are missing from it but covered by this article. Summarize and outline the relevance of each reference to the topic (around 100 words per reference). The bibliography is not counted in the suggested 3000 word target length of the article.''

	'''~~Project~~-management.info'''		*'''project-management.info''' offers a broad palette of information within the field of project management. It also offers a more detailed description of the tools described in this article.
			*'''apm.org.uk''' is the official site of the Association for Project Management. They describe their goal as "''Inspiring communities to deliver meaningful change for societal benefit by advancing the art, science, theory and practice of project management.''"
			*'''pmstudycircle.com''' is a website made from a student, frustrated about the missing information about project management available on the web, when he was writing his exam. Here he has gathered a lot of relevant information about project management.

	== References ==		== References ==
	<references />		<references />