2. This document is proprietary to Project Consulting Group, Inc. and contains confidential information which is solely the property of Project Consulting Group, Inc. This document shall not be used, reproduced, copied, disclosed, and transmitted, in whole or in part, without the express consent of Project Consulting Group.  2003, Project Consulting Group. All rights reserved. Project Parametric Estimating Techniques for developing an Estimating Model That Works Presented by: Creg Schumann & Joseph Kestel

3. Copyright  2003, Project Consulting Group. All rights reserved. PRO ECT CONSULTING GROUP _ __ J 9/23/2015 Agenda Review Estimating Concepts and Terminology Estimating Methods Estimating Tools Inputs Outputs Developing a Parametric Model MQ & FA (Many Questions & Few Answers)

4. Copyright  2003, Project Consulting Group. All rights reserved. PRO ECT CONSULTING GROUP _ __ J 9/23/2015 Estimating Concepts and Terminology Top Down Start with a high level budget (effort, duration, etc.) Break down to the detail of “what” can be done Bottom Up Determine “what” must be built. Roll up the effort to higher level tasks/activities/phases Comparative Compare to similar projects and extrapolate (Niku 6, Primavera, MS Project Central, PM Office, Artemis, etc.) Expert Expert judgment methods such as Delphi, Wideband Delphi, Round Robin

5. Copyright  2003, Project Consulting Group. All rights reserved. PRO ECT CONSULTING GROUP _ __ J 9/23/2015 Estimating Tools Parametric Model http://www.ispa-cost.org/ Models that define at a low level what must be built/accomplished/etc. and how that low level is translated into an estimate of effort, duration, cost, and schedule. Simplistic example: Five widgets must be produced, the team can produce 2.5 widgets in one day, one widget costs $1,000 to build (labor and material), two widget machines are available, 50% of construction time is added for machine maintenance. 3 days effort (1 for maintenance), 1.5 days duration, $5,000 cost

6. Copyright  2003, Project Consulting Group. All rights reserved. PRO ECT CONSULTING GROUP _ __ J 9/23/2015 Estimating Tools COCOMO Model http://sunset.usc.edu/research/COCOMOII/index.html Takes size of work to be done, applies formulas with risk factors (scaling factors and effort multipliers) to determine person months of effort. Also can be used to determine potential duration and staffing models. Function Point Model http://www.ifpug.org/ Method of providing size as input to other estimation models/tools (SEER/SEM, Cost Xpert, Construx Estimate, Estimate Pro, COCOMO, various Parametric Models, etc.)

7. Copyright  2003, Project Consulting Group. All rights reserved. PRO ECT CONSULTING GROUP _ __ J 9/23/2015 Inputs to Estimating Tools Requirements Data (if available) Corporate Effort Breakout Industry Effort Breakout Risk Factors Effort Multipliers Scaling Factors

8. Copyright  2003, Project Consulting Group. All rights reserved. PRO ECT CONSULTING GROUP _ __ J 9/23/2015 Outputs from Estimating Tools Completed Work Breakdown Structure Updated Requirements Updated Risk Assessment Revised Capability Assessment Initial Resource Cost Estimates (Budget)

9. Copyright  2003, Project Consulting Group. All rights reserved. PRO ECT CONSULTING GROUP _ __ J 9/23/2015 Developing a Parametric Model Our Goal: To develop a (parametric) model that would reduce the time to estimate project effort based on initial high-level project requirements

10. Copyright  2003, Project Consulting Group. All rights reserved. PRO ECT CONSULTING GROUP _ __ J 9/23/2015 Developing a Parametric Model Our Objectives: Shorten the process from high-level requirements definition through to WBS generation Estimate-to-Plan in nothing flat! Utilize corporate and industry data to drive accuracy of the model Keep it simple! Users should be able to easily understand it and adjust it! Project Profile WBS

11. Copyright  2003, Project Consulting Group. All rights reserved. PRO ECT CONSULTING GROUP _ __ J 9/23/2015 Developing a Parametric Model Identify Parametric Opportunity Design a Preliminary Parametric Model Calibrate and Validate the Model Incorporate With Organizational Policies and Processes Maintain and Improve the Model Identify Design Calibrate Incorporate Maintain

12. Copyright  2003, Project Consulting Group. All rights reserved. PRO ECT CONSULTING GROUP _ __ J 9/23/2015 Identify Parametric Opportunity Where is Parametric Estimation Applicable? Where processes are reliable and repeatable Where sufficient historical data exists to draw parametric relationships Where sufficient industry data exists to draw parametric relationships Where an organization is large enough to be able to take frequent advantage of such a model and promote maintenance of the model Identify Design Calibrate Incorporate Maintain

13. Copyright  2003, Project Consulting Group. All rights reserved. PRO ECT CONSULTING GROUP _ __ J 9/23/2015 Design a Parametric Model Our Process: Tie high-level requirements definition as input to estimating model Assure that inputs are base on your business practices and nomenclature Assure that input criteria are understood and well documented Project Profile Estimating Model WBS Identify Design Calibrate Incorporate Maintain

14. Copyright  2003, Project Consulting Group. All rights reserved. PRO ECT CONSULTING GROUP _ __ J 9/23/2015 Design a Parametric Model The Project Profile: “Identify the What” What are some typical inputs for your industry? Software Development Financial Services Retail Construction Utility/Telecom Government Please document inputs on the Breakout Session sheets Identify Design Calibrate Incorporate Maintain

15. Copyright  2003, Project Consulting Group. All rights reserved. PRO ECT CONSULTING GROUP _ __ J 9/23/2015 Design a Parametric Model Our Project Profile: Identify Design Calibrate Incorporate Maintain

16. Copyright  2003, Project Consulting Group. All rights reserved. PRO ECT CONSULTING GROUP _ __ J 9/23/2015 Design a Parametric Model Identify Design Calibrate Incorporate Maintain

17. Copyright  2003, Project Consulting Group. All rights reserved. PRO ECT CONSULTING GROUP _ __ J 9/23/2015 Design a Parametric Model Our Process: “Build the Bridge” Create an estimating model that will feed tasks within the standardized WBS template Establish relationships between estimate inputs and each deliverables-based task within your high-level WBS Many-to-One relationships One-to-One relationships Project Profile Estimating Model WBS Identify Design Calibrate Incorporate Maintain

18. Copyright  2003, Project Consulting Group. All rights reserved. PRO ECT CONSULTING GROUP _ __ J 9/23/2015 Design a Parametric Model Our Process: “Build the Bridge” Account for the variables: Establish initial base hours or percentages of grouped hours to accomplish individual tasks Project Profile Estimating Model WBS Identify Design Calibrate Incorporate Maintain

19. Copyright  2003, Project Consulting Group. All rights reserved. PRO ECT CONSULTING GROUP _ __ J 9/23/2015 Design a Parametric Model Our Estimating Model: Identify Design Calibrate Incorporate Maintain

20. Copyright  2003, Project Consulting Group. All rights reserved. PRO ECT CONSULTING GROUP _ __ J 9/23/2015 Design a Parametric Model Identify Design Calibrate Incorporate Maintain

21. Copyright  2003, Project Consulting Group. All rights reserved. PRO ECT CONSULTING GROUP _ __ J 9/23/2015 Design a Parametric Model Our Process: “Create the Plan” Utilize and update corporate WBS template Adjust for time reporting and earned value calculations (Develop a High-Level Stage/Activity WBS that eliminates confusing detail!) Make the WBS deliverables-based! Manage the details in a detailed WBS outside of this WBS as a detailed checklist or task-list This High-Level WBS should only be used for time reporting and earned value calculations Project Profile Estimating Model WBS Identify Design Calibrate Incorporate Maintain

22. Copyright  2003, Project Consulting Group. All rights reserved. PRO ECT CONSULTING GROUP _ __ J 9/23/2015 Design a Parametric Model Our WBS: Identify Design Calibrate Incorporate Maintain

23. Copyright  2003, Project Consulting Group. All rights reserved. PRO ECT CONSULTING GROUP _ __ J 9/23/2015 Design a Parametric Model Identify Design Calibrate Incorporate Maintain

24. Copyright  2003, Project Consulting Group. All rights reserved. PRO ECT CONSULTING GROUP _ __ J 9/23/2015 Calibrate and Validate the Model Our Process: Establish and readjust the relationships between: Conduct variance analysis and adjust the estimating tool as necessary Test and revise as new projects are conducted and as data is gathered Project Profile Industry Data Corporate Data Identify Design Calibrate Incorporate Maintain WBS Estimating Model

25. Copyright  2003, Project Consulting Group. All rights reserved. PRO ECT CONSULTING GROUP _ __ J 9/23/2015 Incorporate into Organization Our Process: Establish Schedule Based on duration calculations as well as forward and backward paths, critical paths, and dependences, etc. Establish Cost Based on effort estimates (hours only) by generalize resource listing and the percentage of work they will be expected to perform Include blended rates (or specific rates if necessary) based on groupings of expertise/dollars Establish Staffing Models Based on duration and loading model calculations Make it real by looking at skill sets, dependencies, and availability Identify Design Calibrate Incorporate Maintain

26. Copyright  2003, Project Consulting Group. All rights reserved. PRO ECT CONSULTING GROUP _ __ J 9/23/2015 Incorporate Into Organization Our Process: Create instructional documentation that directs repeatable and reliable use when: Completing the Project Profile Adjusting the Estimating Model components Tailoring the WBS Roll-out and train when and where necessary Identify Design Calibrate Incorporate Maintain

27. Copyright  2003, Project Consulting Group. All rights reserved. PRO ECT CONSULTING GROUP _ __ J 9/23/2015 Maintain Our Process: Add risk weighting factors in the future to account for this element within estimating model Continue to test and revise as new projects are conducted and data is gathered Report variance (estimates-to-actuals) on: Duration Effort Cost Size Staffing Identify Design Calibrate Incorporate Maintain

28. Copyright  2003, Project Consulting Group. All rights reserved. PRO ECT CONSULTING GROUP _ __ J 9/23/2015 Many Questions / Few Answers