Our tagline Estimate - Execute - Deliver, overall states what we believe to be foundational elements in any IT related project. In the following I'll try to explain why estimation for any IT project is almost always needed and why it ties closely together with the subsequent execution of the project. Estimation and execution are the two foundational pillars for any IT related project and properly combining these, with good reporting and feedback, will result in successful deliveries.
Estimates are crucial to ensure that the project, to the best of current knowledge, knows the total effort to deliver. An estimate is an educated guess of what will be needed in a project, based on history and statistics. Creating accurate cost estimates for software product development projects has on several occasions proven to be a big challenge for the industry. Estimations are usually carried out several times during the life cycle of a project and it's obvious that the more information you have, the more accurate your estimate will be. Agile estimation anyone?
While qualifying a project, a high-level preliminary estimate that has a significant number of assumptions is generally prepared. After these assumptions have been validated, an even more accurate estimate can be created. Estimates will obviously always be prepared for the known quantity of work, and even after the project has been started, the estimates and assumptions should continuously be refined. At the end of the project, when you have perfect hindsight, it is then possible to accurately "estimate" the size of the project. That is why it is important to feed that information back into the next opportunity. Historical data can help companies reap great benefits but is something very few actually practice. It is only when the true actuals at the end of the project are captured and used intelligently, that you can generate a more accurate estimate on the next project.
During the proposal and initial stage, you will almost always have to depend heavily on top-down estimating but there may be some bottom-up validation of initial phases that have been planned out in detail.
All of the estimates then get baselined when stakeholders agree and roll over into the project execution phase once the project is approved and ready to be initiated.
Subsequent execution of the project after budgets and scope has been approved, is something that needs to be kept in check to ensure success. As the project initiates with a baseline estimate and the detailed solution and task plans are developed, bottom-up estimation techniques have the main influence on the updated project estimate. Supporting the development process typically using either Scrum or Waterfall can then be done based on this baseline estimate and initial task list, backlog, use case requirements or whatever initial project knowledge is available from the estimation.
As the project rolls along, the actual hours delivered by the team(s), cost and other parameters can then be tracked and compared to the baseline to constantly give relevant input and insights to stakeholders e.g. mid- or top-level management, project managers, Scrum masters, developers. By having the right reporting and analytics in place, everyone can be rightly informed of the actual project status and whether execution is running according to plan or not. If this is in place it suddenly becomes much easier to pinpoint problematic areas in the project and ensure that corrective action can be taken as fast as possible, if things should start to slip.
Along the way of running the project, or as the project completes, the actuals are then gathered (preferably automatically) and compared to the model in the system, which then steadily aligns itself to give an even more accurate estimate for reuse in the next project.
A successful feedback loop for improving the company process, insights, costs, and transparency is now established.
With all of the above working effectively together, any given project will have a much greater rate of successful delivery. This is why Forecast.it is divided into these 3 main pillars; estimation, execution and reporting. Forecast.it intelligently adapts to your company, it learns and evolves with you.
We're here to help you be successful with your IT projects.