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 Better Estimates  Better Estimates   Estimating What and When   Estimating What and When

We need a project before we can start any serious work targeting our objectives. We need a plan before we can start any serious work on the project and we perform planning to derive a plan. This is where we need estimating. We will estimate before we can seriously perform any reliable planning. Our plans are only as good as our estimates and our estimates are only as good as the data, people, experience, process and techniques used to create them. Our estimates are our best guess about what we believe our actual costs will be.

Remember we are using the word: estimate. This is not a quote or a fixed bid for the work. Also we need some money to deliver the project. Normally this is in the form of a budget we can work to either from our departmental or organisational management or from a client who has allocated a budget based upon estimates given by a delivery partner. To simplify, we need a budget and a plan before we can start work and we need an estimate before we get agreed budget and before we can start planning.

So the sequence is estimate, allocate budget then start planning. This first stage of pre-plan estimating is of course high level. As part of the planning stage you will begin to uncover a little more of the delivery and feed that back into your estimating processes.

Naturally, in the early stages, you will have some uncertainty in your estimates and they should reflect this. The early stage estimate is therefore presented in a band i.e. from a low to a high estimate for example from 200 to 220 days. 200 is the low estimate and 220 is the high estimate. Also in the documentation supporting the estimate (e.g. an email or covering document) you will explain the level of uncertainty around the estimate, that this is revisited after some exploration and discovery work is done on the project and that the budget for the project should cover the higher estimate.

The early stage estimate is only used to get an idea of the size of budget needed for the project: small, medium, large or maybe very large. It is used to plan these albeit loosely sized projects into the project pipeline for the whole organisation, to help to determine how and where the organisational (and maybe departmental) budget will be allocated and to allocate budgets to projects. The sizing is also used to determine if agile is an appropriate approach for the project. We propose it is used for small or typical projects and debate this elsewhere in the Toolkit. The budget may be allocated for the next stage, one or more stages, just for the work to explore the project and derive a more representative estimate or in some circumstances (mostly if a change is mandatory or a legal requirement) for a whole project.

So, let us imagine you have derived an early stage estimate and this has been presented to your management for approval, it has been approved and a budget has been allocated which allows the project to explore it in more detail and to derive a more representative estimate and to spend up to the maximum of your budget. We are in the early stage of your project and now you have the budget to explore the work further and to derive estimates that will withstand scrutiny.

You may often hear this stage called the pre-project planning or the early estimating stage or maybe feasibility or some other title altogether. Whatever the stage is called does not matter; rather what we do in the stage: provide quality estimating outcomes. On that basis, let us look at when we use agile estimating techniques and the estimates we will produce.


 Better Estimates     Better Estimates   Estimating What and When    Estimating What and When

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Background to Agile Estimating


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