Calculate with confidence


Estimating software eliminates guesswork in project planning and frees project managers to focus on the deliverables.



Costs, durations, workload, resources, percent complete. With so many numbers clouding the plan, a project manager can lose sight of the overall details that contribute to the big picture. Add a company's past project performance variables into the mix, and a project can seem downright unmanageable.

Estimating software can clearly and realistically portray a project team's capabilities. More than automated number crunchers, these applications save you the pain of recreating new projections every time. With standardized templates, you have more time to analyze alternative plans and paint different pictures of the same project. “I can do multiple ‘what ifs’ at the same time,” says Ruthanne Schulte, product manager for Welcom, Houston, Texas, USA. “I can set up five or six different estimates using different rates, and then I can go back, and I can analyze my different projects, or I can even do an analysis across all my projects.”

If a project gets off track, you can use the software to show where the most sensible tradeoffs can be made to recover. “We give people the opportunity to really see what can be done,” says Dan Galorath, president of Galorath Inc., El Segundo, Calif., USA. “By using estimating software, you can come up with project plans that you can really implement. Without this software, I see people panic and say they're going to double the staff to get the thing done, but these models will show you how many people you can absorb and when not to do that.”

However, estimating software isn't always the solution to all your front-end problems. “Cost estimating software can't drive the car for you, but it will give you the fastest, most efficient way to get to your destination,” says Benny Barbe, president of Cost Xpert Group, Rancho San Diego, Calif., USA.

To get the most from a new application, you must first look inward to ensure your organization operates with well-configured processes. “You should already have the discipline in place before you buy the tool,” says Kristine Worland, a project management consultant for Continuum Consulting, Tempe, Ariz., USA. With the proper procedures in place before software implementation, you essentially will automate what you've already been doing, and you'll gain quicker buy-in among project team members.


I can set up five or six different estimates using different rates, and then I can go back, and I can analyze my different projects, or I can even do an analysis across all my projects.


Shop Around

That internal examination also will help when searching for products to optimize your team's performance. Consider which products best reflect the way you do business. “Software shouldn't change the way you estimate,” says Steve Watt, vice president, director of estimating products at Timberline Software Corp., Beaverton, Ore., USA. “A good system should be able to capture your methods for putting estimates together. If it doesn't, I’d be highly skeptical.”

For example, the more detailed your project estimates are, the more inputs you'll want your system to allow. “You want to try to get a model with inputs that are a natural by-product of your development process,” says Brad Clark, a technical consultant with Software Metrics Inc., Haymarket,Va., USA.

Decide how you want to look at the data once you've keyed it into the system. Most systems offer flexible features, from detailed to conceptual views at either end of the project life cycle. “The same tool should really be able to solve both problems because you're using the same historical data to do both,” Watt says.

You should already have the discipline in place before you buy the tool.

kristine worland,


Most applications allow you to present your data in a variety of ways, from graphical depictions to spreadsheet formats to textual charts. You also need to consider how you'll present your pricing to your clients. Vendors and users alike stress the importance of producing a price range rather than one fixed number, especially at the front-end of a project's life cycle when details are far from concrete.

“That can be a number that people take and sometimes pin on a wall and say, ‘That's the number we're going for,’” Clark says. “But all data has variation. The model estimates are really just averages. Everyone should expect variation about or around the estimation because models cannot account for everything that happens on a project. Models don't account for bad decisions, changes in schedule or requirements.”

At the Ready

Ultimately, the decision may simply come down to the software provider. “You're going to be building models and relying on this information, so you're actually forming a relationship with this company,” says Brad Holtz, president and chief executive officer of Cyon Research, Bethesda, Md., USA. “The true decision is: Do I trust this company to be working in my interest in the long run?”

Large vendors tend to provide a full range of services, from product design, on-site implementation and calibration, to problem-solving services after the go-live date. Most vendors offer some type of training session to learn the intricacies of the systems. These sessions, which generally last from two to five days, allow your front-line staff to get a jumpstart on understanding the system and will allow them to teach secondary staff in-house on a day-to-day basis.

“People can figure out the systems on their own, but the problem I see sometimes is that people will go down a path thinking a system can't do something only to find out a year later that it can do that,” Watt says. “The people who skip [training] are cutting a corner they shouldn't be cutting.”

Fill in the Cracks

After go-live, benefits can appear as soon as your team makes its next estimates or as long as it takes for you to adjust to the new method. “Sometimes it takes people a little bit of time to start trusting the model,” Clark says.

On a qualitative level, you'll find your team looking at a project in more detail at the front end, preventing smaller items from falling through the cracks, according to Stephen Maye, director of product partnerships for, Fairfax, Va., USA. In the long term, he says, you'll see improved delivery processes.

Ultimately though, a new system's benefits will depend on how honest you are with it. Galorath recalls working with Holland Signaal, a Netherlands-based defense contractor, who said its model wasn't working properly. Upon inspection, he discovered the clients had been rating their entire staff at an extra-high experience level. After running the program backward, inputting an average staff level, Galorath says the model worked accordingly. “They were so upset they just stopped using the model,” he says. “Theoretically, I can make models say anything I want, but if I lie to the model, it'll lie back to me. You've got to be realistic.”

Your level of expertise also will factor in to how much you can gain from an estimating system. “The making of more accurate estimates cannot be achieved by just a piece of software alone,” says Meri Duncanson, a vice president of publicity with the Australian Performance Management Association. “The software can collate the estimates and even compare them against previous projects and use proficiency factors or industry metrics to attempt to create more accurate estimates, but they will always only be as accurate as the input from the user.”


Whether you're an expert or a novice, you must be diligent with your data to maintain and eventually increase your accuracy. Keeping good records from front to back will help refine your standardized templates and proffer better estimates in the future. “The more you use the model and calibrate it, the better it's going to help you understand your decisions and make better plans,” Clark says.

What's Ahead

Still relatively new to these applications, most companies look for estimating systems with out-of-the-box usability, but several trends on the horizon are pushing these standard applications onto a new frontier. A few programs are transforming into ratings systems. “One of the things that they can do is identify not only what is the right decision to make or the best decision to make given the parameters, but how much they can rely on that decision,” Clark says.

Companies also are increasingly using the newer programs to help make better management decisions. Estimators can show the quantitative impact, for example, of awarding a bonus to one of your top executives versus the influence of his leaving the company for better pay. “We can ask these applications, ‘If we lose our chief architect to another company, what will the impact be on the reduction of experience? Will it be more worthwhile to keep him here and pay him more?” Clark says. “A cost model can be used to quantify the cost of a before-and-after decision.”

However, companies still are working on the basics, Galorath says. “There's now a huge trend developing toward using [the program] day-to-day and updating estimates consistently,” he says. “They're beginning to use these applications upfront about how to reduce costs, when it's still in the design stage, which can significantly save them tens of thousands of dollars.” PM


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