- The two most common questions that people ask you as a project manager are how long? And how much? To answer these questions you need to be able to provide quality estimates for the resources and costs required for the project, as well as the duration for each activity. In this video, we'll discuss common estimating problems, re-estimating throughout the project life cycle and techniques you can use to estimate. You should keep in mind that you will get better at estimating with time and experience. So take the time to review your assessments in retrospect to see what you got right, and where you went wrong. Beyond simply experience, there are a few common issues most people face when trying to estimate. The first one of these is optimism over pessimism. Simply put, if you're more of a glass half full or half empty kind of person, you could either overestimate or underestimate. Do some self reflection to think about what kind of person you are so you can look out for any innate bias you have. Next, social or political pressure. Pressure from management, peers or a client could push you to underestimate. When this happens though, the project team will have to take the strain of unrealistic budgets and deadlines. So be aware of any pressure you might be under and account for it. Another common issue that estimate is, is unclear scope. If you don't have a clear scope of what the project needs to achieve, estimating with any precision becomes basically impossible. Always emphasize the need for a clear and concise scope. Many people think that estimates are a once and done kind of thing. You estimate at the start and that's it. The problem with this is that most uncertainty exists at the very start of a project. As requirements become defined, start being deployed and eventually put into use, it becomes easier and easier to estimate. That's why you should estimate often, so you can stay on top of the estimates and keep the business case viable and help the organization to make difficult decisions at any decision gate. Okay, now we've covered why you need to estimate, and some of the issues you might encounter while you do. So let's move on to a few techniques you can use to estimate including their strengths and weaknesses. The first technique you can use is comparative or analogous estimation. To estimate like this, you need data on costs and time from previous similar projects. This is quick to produce and reliable for similar work but is very reliant on previous project data. So it isn't great if the project is looking to do something new. Next, you can use parametric estimation. To do this, you need to formulate models for the project using algorithms based on historical data. While this technique is often more accurate than comparative estimation, you'll need to be able to formulate these equations as well as rely on accurate historical data. Analytical estimation tries to create very accurate estimates for each work package, then bring these all together in a work breakdown structure or WBS. This is great because it allows you to leverage subject matter experts who can help you with each individual breakdown but on the downside, it can take a lot of time to work out. Delphi estimation draws on a group of experts who all exchange views and then give independent estimates and assumptions. Once you've gathered this information you create a report that takes into account their input. This is a versatile technique you can use in different circumstances, but it can also be time consuming and is often open to expert biases. Finally, three point estimation or PERT, program evaluation and review technique, accepts the uncertainty involved in estimating, and considers three estimates for any activity; a most likely value on average value, or an optimistic value for best case value, and a pessimistic value for worst case value. You can use these three estimates to calculate a weighted average estimate according to the following formula; PERT duration or cost is equal to optimistic plus four times most likely plus pessimistic over six. And that's it for this video. As a project manager, you'll need to be able to estimate, and often. In this video we've covered why this is important, some issues you need to deal with and a few techniques you can use to do so.