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A Guide to Project Management

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Chapter 2

The Dark Art of Project Estimation

Written by Brett Harned


No matter the size or budget, estimating a project can be a daunting task. Every project request comes with a mystical, gray area that makes everyone nervous about expectations concerning cost, timelines, and level of effort. Because the gray area changes from project to project, there is no magical potion for creating a solid estimate. In order to create a workable estimate, you need to know your team, deliverables, tasks, and process like the back of your hand. You also have to be comfortable asking questions to figure out the things that you (and maybe even your potential client or customer) do not know.

This chapter touches on best practices for creating project estimates grounded in your understanding of a project reality  and being prepared for that alternate universe that eventually ends up in a change request. Get ready to learn a whole new set of dark arts, because you’re about to become the best project estimator in the business.

One of the biggest problems PMs face is having a solid understanding of what each team member does on a daily basis.

Understand What It Takes

One of the biggest problems project managers face is having a solid understanding of what each and every team member actually does on a daily basis. A good project manager will know his or her own role very well. He or she can:

All of this is great, but only if you’re the PM who sits behind a desk and doesn’t actually engage in the work. Here’s the thing: you MUST engage in the work to be a good project manager. You can’t be a desk jockey. You have to dig into the work along with your team and take the time to understand all of the things that will cause your project to go over budget. We’re talking about: the people, the budget, and the scope.

Learn What You Can

I work in the web industry and I’d never sell myself as a web designer or a developer. That being said, I’ve learned enough about design and code over the course of my career to make me horribly dangerous. I would never step into a project and say, "I’m the best resource to design or code this," but I know enough about how things are done to ask the right questions and make the proper assumptions about how they should or could be done. This helps immensely when estimating project work.

I learned a lot of web skills early in my career and have had to stay on top of industry trends and major changes ever since. In addition to that, I had to learn a whole new set of people, processes, and clients every time I started a new job with a new company. A career in project management means you have to always stay on top of trends, changes, and deliverables in your industry. It isn’t easy, but it’s worth it because it will directly affect your success as a PM.

So how do you stay on top of things? Aside from reading relevant trade publications, websites, and blogs and attending training and networking events, you should leverage the people who sit on your team.

A career in PM means you have to always stay on top of trends, changes, and deliverables in your industry.

Understand the Roles on your Team

Who the heck are these people and what are they doing all day? Sure, it’s easy to read Jim’s job description and find out what he "does for a living," but that doesn’t tell you much about the mechanics of what he does on a task level. That’s what you really need to know. So, how are you supposed to understand Jim’s role on the team and how his work will impact an estimate?

You just have to talk to Jim.

As a project manager, one of the best things you can do is be genuine and be honest about what you don’t know. If you really want to know how or why someone does their job, just ask them! It might sound silly, but most project managers feel like they’re supposed to just know everything. You don’t, and that is okay. Remember: it’s better to admit what you don’t know and ask questions. Doing so gives you an opportunity to connect with your team on an individual level, and it will help you to understand the inner workings of your projects. After all, figuring out the steps one person takes to create a deliverable will work wonders in helping you calculate a true estimate.

Understand Process and What Works

Once you’ve got a good grasp on who does what and how, you need to figure out how all of your project’s moving parts fit together—or could fit together.

You may work for a company that abides by a singular process like Agile, Waterfall, etc. In that case, you should study that process, know all of your dependencies, and run with your estimates. If you work in a place that’s more liberal with process and likes to experiment, make it your mission to understand how things are done and what might happen if you shift things around. For instance, if you work for a construction company, will there be a huge impact if you plan for your baseboards to be painted before the carpet is installed? Sure, you can do it, but will it affect the quality of the work or the time needed to get the work done? (I’ve done my share of home improvement projects and can comfortably say the answer is “yes.” When the carpet installers scratch up those newly painted baseboards, your client will not be happy to learn they will need to be repainted.)

Do everything you can to understand your process, but don’t just read a book or a manual.

Do everything you can to understand your process, but don’t just read a book or a manual. Use the rigid methodology taught in a book or a manual to start conversations about how your team employs a method. Talk to your team, ask questions about what you don’t know, and feel free to question how, why, and when things are done. The more you know, the better you can strategize with your team or your clients to find alternate ways to make projects work and save on effort.

Also related, always be sure to include your team in any discussions related to estimating projects and process. When estimating projects, talk about the process you might envision taking on with the impending project. This will certainly impact how you think about effort and scope. You’d never want to sign on for a project that the team is not invested in.

Always be sure to include your team in any discussions related to estimating projects and process.

Study History

Without a doubt, historical data can help you with new projects; when history is documented, you can analyze the information to help you create better estimates. A great place to start is asking your team to track their time on tasks, which will give you a better sense for a project’s overall level of effort. It’s not about cracking the whip or playing big brother and hanging over someone’s shoulder—it’s being honest about the effort and being profitable at the same time.

It goes without saying that every project is a unique snowflake! Project managers encounter tremendous variety in clients, communications, team members, technology, and so on, but seeing how long your team spent on a certain task or deliverable will give you a sense for estimating a similar task on a new project.

As project managers, we tend to underestimate, thinking we’re doing our clients and our team a favor. But we’re not! We’re doing everyone a disservice and stressing out over not hitting estimated budgets and timelines. Listen up! Drop the stress. Check your tracked time and use it to create a realistic estimate. If nothing else, reviewing the history to make sure you’re not habitually underestimating is a great practice.

TeamGantt tip: Check out the project baseline feature in TeamGantt after you’ve completed a project, check your actuals. Within the feature, you can mark your originally planned schedule and then compare it against your actual work as the project progresses. Note where there might have been issues and how those issues might have impacted your level of effort. This will help you to determine if you might have estimated the project differently, if you had it to do over again.

Ask More Questions

Whether you’re estimating a project based on a Request For Proposal (RFP), a discussion, or a brief written message, you need to know every possible detail of the project before you can provide a realistic estimate. This often means that you have to ask more questions. Don’t be bashful! Many clients don’t realize that you need a tremendous amount of information in order to prepare a true and fair estimate. They also might not realize that they already have the answers to your questions.

One of the biggest culprits behind mis-estimated projects is the lack of pertinent information and background provided on would-be projects. Get your clients to clear up that gray area and help you break the project down into pieces. That way, you'll be able to create an estimate based on what they need, not what you think they need. You can use our project management software to help stimate your RFP.

One of the biggest culprits behind mis-estimated projects is the lack of pertinent information and background provided on would-be projects.

What Do You Need To Know?

It’s often easy to take a project request at face value. The problem with doing that is the fact that there are likely a lot of details to uncover. So put your thinking hat on and scrutinize the request. Here are some things to think about on any project request:

This list could go on and on depending on the level of information you’re provided. Be persistent and get the answers you need. And, if your client is not inclined to answer every question, take it as a sign. If it’s too much to answer a set of questions to help you form a good estimate now, will it be too much for them to be a good partner when the project is underway? Use your judgement in this respect. Not every estimate becomes a real project, so not every request needs to become a real estimate.

Apply a Work Breakdown Structure

We’re pulling out some basic, old school PM knowledge here. Do you know what a Work Breakdown Structure (WBS) is?

A fixture in classic project management methodology and systems engineering, the work breakdown structure is a deliverable-oriented decomposition of a project into smaller components. A work breakdown structure is composed of a hierarchy of specific elements; an element may be a product, data, service, or any combination thereof. A WBS also provides the necessary framework for detailed cost estimating; it provides guidance for schedule development and control.

Creating a work breakdown structure for any plan helps you get granular about project tasks.

Creating a work breakdown structure for any plan or set of tasks helps you get granular about the work that needs to be done on any given project. Below is a very basic WBS for a very common deliverable—moving! Check out the tasks and every aspect related to the event that the author has taken into consideration. Is anything missing?

If you estimate your projects based on units—whether it be weeks, days, or hours—using a WBS will help you understand very quickly if your estimate will exceed the intended budget. Let's take this example further and assign estimated hours to each step, but just remember, it could change when you dig into the actual work. (These time estimates should be based on a combination of experience and hypotheses.)

Current House

Pack: 8.5 days total
* Sum of tasks includes, wrapping objects, packing in boxes, prepping for movers. Rooms and estimated timing is as follows:

This type of exercise can be extremely helpful during the sales process when a client tells you they have X dollars to spend. Based on your estimates, you can easily map a set of tasks or deliverables to something that works for both the dollar amount and the client’s goals. And, if a potential client comes back and says, “Well that seems a little more than we want to spend,” you can lean on your work breakdown structure to negotiate the cost down based on what's included in your scope. For instance, if I had to cut down on cost/time on moving based on my hours efforts, I could likely remove the “cleaning” step from my “moving” WBS (though I’m sure someone might be unhappy about that). Use the WBS to your advantage this way and you'll not only create a project estimate that maps to a specific budget, you’ll work out a solid set of project requirements.

Using these techniques as a foundation to create your estimate will help you with the next step: turning it into a project plan.We’ll discuss project planning more in the next chapter.

Estimating Projects with TeamGantt

Another easy way to estimate a project is to use one of your favorite planning tools. TeamGantt makes it easy to set up a potential project. In fact, it gives you a more formalized way to list out your work breakdown structure and assign tasks and timelines to your team. You can create those timelines based on effort and assign resources (or people) within an online gantt chart. From there, you can schedule people against other project work. Learn more about Team Gantt.

Get To It

Are you ready to dig in and estimate a project of your own? Try out a test run: make up a project of your own and list out all of the steps that need to go into completing it. Run it by one of your team members and see what they think. Did you miss anything? Did you underestimate the hours? Doing a test run will get you ready for your first real estimate, or hone your skills for your next one.

You’ll find that there is no right or wrong way to create an estimate. Your own dark art of estimating projects will include a mixture of project knowledge, historical review, client inquisition, and a ton of gut instinct. Try out a test run: make up a project of your own and list out all of the steps that go into completing it. Use TeamGantt's free project management software to get started.

What to read next:

Chapter 3:


A solid plan is created after you’ve done your research about the team, your clients, and your project and have determined all of the factors that will make that plan change.

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