Project Management Institute

Project management cost estimate

a case study in electronic warfare system flight test costs

Because cost constraints are highly scrutinized throughout the project life cycle, project managers need cost estimates they can use as the project's cost baseline. This article describes the development of a cost estimating model that the author developed for the United States Air Force (USAF), a model that uses parametric techniques to predict the costs associated with airplane flights to test electronic warfare equipment. In doing so, it explains the problem that this model solved, the scope of its focus, and the purpose of its function. It then discusses other techniques used by the USAF and its process of selecting this model; it details the four steps used to select and specify the model's independent variables, a process that also involves a principal component analysis and a multiple linear regression analysis. It discusses the result of this process, one from which emerged a linear regression model using five variables and a principal component analysis using thirteen variables.
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