Become an Estimating PRO
A big part of project management is properly estimate project budgets. However, we usually can’t do it alone; we rely on the help of our creative talent, like developers, designers, and copywriters, to estimate individual pieces of the bigger budget or timeline. This can be especially difficult when dealing with uncertain requirements.
This PRO tip, using the PERT method, will help you narrow down an overwhelming range.
For starters, PERT stands for Program Evaluation and Review Technique model (if you’re curious).
The theory behind PERT is that an educated guess should account for the worst case, best case, and realistic scenarios. When you only estimate the best case scenario, you set your client up for disappointment when the budget goes over. When you only estimate the worst case scenario, you set yourself up for disappointment by losing business to lower bids. Meanwhile, estimating only the realistic scenario ignores the reality that things rarely go as planned.
To identify the best estimate, consider use the following formula:
P + 4(R) + O
To remember the formula, think PRO!
- Pessimistic (P) is the worst case scenario: You don’t get everything you need, the client is difficult to get in touch with, and tasks are more difficult than you expected.
- Realistic (R) is the most likely scenario: You get what you need to get the job done, the client is relatively responsive, and tasks are about as difficult than you expected.
- Optimistic (O) is the best case scenario: You get everything you need (and then some), the client responds to every question immediately, and tasks are easier than you expected.
PERT heavily weighs the realistic scenario, while still accounting for the possibility of worst and base case scenarios.
Now, let’s try it out on a few examples.
Let’s say you have an individual project task that could take anywhere from 4 hours to 70 hours. Your realistic guess is 15.
70 + 4(15) + 4
Your task estimate using the PERT method would be about 23 hours.
Now, let’s try it on a larger project. Let’s say a total project budget could take anywhere from 150 hours to 590 hours, but similar projects in the past have been closer to 225 hours.
590 + 4(225) + 150
The Ballpark estimate using the PERT method would be about 274 hours.
In sum (excuse the math pun), the PERT method can help reduce uncertainty when estimating uncertain tasks. Enjoy!
If you’re a marketing professional looking for a development partner who will put serious thought into your RFP estimate, you’ve come to the right place. At fjorge, we are continuously looking for new ways to improve our skills and become the perfect partner for your next project.