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    Cost and Time Estimation 19IN

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    timesave240
    The document discusses different approaches to project cost and time estimation including macro, micro, and hybrid approaches. It explains that macro approaches provide quick but rough estimates while micro or bottom-up approaches are more time consuming but can provide accurate estimates. Accurate estimation is important for project planning, scheduling, and control.

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    Cost and Time Estimation 19IN

    Uploaded by

    timesave240
    35 views7 pages
    The document discusses different approaches to project cost and time estimation including macro, micro, and hybrid approaches. It explains that macro approaches provide quick but rough estimates while micro or bottom-up approaches are more time consuming but can provide accurate estimates. Accurate estimation is important for project planning, scheduling, and control.

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    The document discusses different approaches to project cost and time estimation including macro, micro, and hybrid approaches. It explains that macro approaches provide quick but rough estimates while micro or bottom-up approaches are more time consuming but can provide accurate estimates. Accurate estimation is important for project planning, scheduling, and control.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    35 views7 pages

    Cost and Time Estimation 19IN

    Uploaded by

    timesave240
    The document discusses different approaches to project cost and time estimation including macro, micro, and hybrid approaches. It explains that macro approaches provide quick but rough estimates while micro or bottom-up approaches are more time consuming but can provide accurate estimates. Accurate estimation is important for project planning, scheduling, and control.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
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    Fair Use Notice

    The material used in this presentation i.e., pictures/graphs/text, etc. is solely


    intended for educational/teaching purpose, offered free of cost to the students for
    use under special circumstances of Online Education due to COVID-19 Lockdown
    situation and may include copyrighted material - the use of which may not have
    been specifically authorized by Copyright Owners. It\s application constitutes Fair
    Use of any such copyrighted material as provided in globally accepted law of many
    countries. The contents of presentations are intended only for the attendees of the
    class being conducted by the presenter.

    10/11/2022
    Cost and Time Estimation
    Project Estimate
    Times
    Costs
    Project estimation is indeed a yardstick for project cost control.
    And if the yardstick is faulty, you start on the “wrong foot.” . . .
    we exhort you not to underestimate the estimate.
    (O. P. Kharbanda and J. K. Pinto, 1996).

    Estimating is the process of forecasting or approximating the time and cost of


    completing project deliverables.
    Cost and Time Estimation
    Cost The Macro or Top-down estimates are usually done by
    Estimating senior management.
    Approaches

    The Macro or Top-Down approach can


    provide a quick but rough estimate.
    Macro Micro Hybrid

    • Done when the time and expense of a


    • Macro (Top-down) Approaches detailed estimate are an issue.
    • Consensus methods • Usually occurs during conception stage
    when a full design and WBS are not
    • Expert judgment
    available.
    • Apportion method
    • Requires experienced personnel to do the
    • Learning curves estimate.
    • Can be highly inaccurate
    Cost and Time Estimation

    Cost
    Estimating
    Approaches

    Macro for the projectMicro


    This approach begins with a top-down estimate Hybrid
    and then refines estimates
    for phases of the project as it is implemented.

    Hybrid approach begins with a top-down estimate for the project and then refines estimates for
    phases of the project as it is implemented.
    Cost and Time Estimation
    Cost Micro or Bottom-up estimates are typically performed by the
    Estimating
    Approaches people who are doing the work.
    Bottom- up approach
    Macro Micro Hybrid
    • Most time consuming and most expensive
    • Uses WBS where each task is estimated and
    • Micro (Bottom-Up) Approaches then added together as reverse upward “Roll –
    up of Elements”.
    – Template
    Bottom-up estimates methods
    are typically performed by
    the people who are doing the work. • Can provide an accurate estimate but is time
    – Parametric Procedures consuming.
    – Detailed Methods for WBS (Work • May require multiple personnel and time to
    Packages) complete.
    • If done properly, a bottom-up estimate can
    yield accurate cost and time estimates.
    Cost and Time Estimation
    Why Estimating Time and Cost Are Important

    ❖Estimates are needed to support good decisions.


    ❖Estimates are needed to schedule work.
    ❖Estimates are needed to determine how long the project should take and its
    cost.
    Bottom-up estimates are typically performed by
    ❖Estimates are needed to determine whether the project is worth doing.
    the people who are doing the work.

    ❖Estimates are needed to develop cash flow needs.


    ❖Estimates are needed to determine how well the project is progressing.
    ❖Estimates are needed to develop time-phased budgets and establish the
    project baseline.
    Cost and Time Estimation
    FACTORS WHICH INFLUENCE ESTIMATION

    ❖Planning Horizon.
    ❖Project Duration.
    ❖People
    ❖Project
    Bottom-up structure
    estimates and
    are typically organization
    performed by
    the people who are doing the work.
    ❖Padding Estimates
    ❖ organizational culture

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