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Cost Estimating Methods Compared

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Mark Warner Project Manager| AURA Tucson, Az, United States
Can someone either weigh-in directly, or point me to a good online discussion of comparisons between cost estimating methodologies? Specifically, I’d like to see the relative pros and cons of different methods, including a ranked “accuracy” list in order from least to most accurate. E.g., comparisons between top-down allocations, analogous methods, expert judgement, Delphi, parametric, bottom-up, PERT-adjusted bottom-up, fixed-price vendor quotes, etc…. Thanks!
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Kiron Bondale Retired | Mentor| Retired Welland, Ontario, Canada
Mark -

a Google search reveals many online articles such as this one: https://www.researchgate.net/publication/3...ethods_A_Survey

However, the right estimation technique will be based on your context including:
- organization standards
- degree of precision and accuracy required
- timing in the life of the project
- nature of the project approach (e.g. adaptive vs predictive)

It is also good practice to combine estimation methods so that you can sanity check the outputs.

Kiron
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1 reply by Mark Warner
Jan 25, 2023 11:05 AM
Mark Warner
...
Kiron, yes, thanks, I have already performed a number of Google Searches on the topic. The problem is some of that information is contradictory, written by non-experts, and/or buried in heaps of text.

I'm looking for a ranked order listing with pro's and con's... that I can believe.

And yes, you're correct that the right estimation technique for you will depend on a number of circumstances. In fact, that's why I'm looking for this kind of concise (and correct) list.
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Mark Warner Project Manager| AURA Tucson, Az, United States
Jan 25, 2023 9:47 AM
Replying to Kiron Bondale
...
Mark -

a Google search reveals many online articles such as this one: https://www.researchgate.net/publication/3...ethods_A_Survey

However, the right estimation technique will be based on your context including:
- organization standards
- degree of precision and accuracy required
- timing in the life of the project
- nature of the project approach (e.g. adaptive vs predictive)

It is also good practice to combine estimation methods so that you can sanity check the outputs.

Kiron
Kiron, yes, thanks, I have already performed a number of Google Searches on the topic. The problem is some of that information is contradictory, written by non-experts, and/or buried in heaps of text.

I'm looking for a ranked order listing with pro's and con's... that I can believe.

And yes, you're correct that the right estimation technique for you will depend on a number of circumstances. In fact, that's why I'm looking for this kind of concise (and correct) list.
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Verónica Elizabeth Pozo Ruiz RYLAI Access Control Quito, Pichincha, Ecuador
In this article you can find a good comparison of cost estimates: https://www.costengineering.eu/blog-articl...cost-estimating
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Kiron Bondale Retired | Mentor| Retired Welland, Ontario, Canada
Mark -

I'd suggest you'd get relative comparisons not an absolute ranking and each would have some pretty heavy qualifiers. Any article or research that claims an absolute ranking for these is likely not worth trusting.

About the only claim I'd make which should hold up to scrutiny is that multi-point or ranged estimation will generally be more accurate than single point estimation

Kiron
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Sergio Luis Conte Helping to create solutions for everyone| Worldwide based Organizations Buenos Aires, Argentina
In my personal experience, the best source I found along the years is IEEE standards and publications. If you are talking about software and systems then ACM publications.
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Latha Thamma reddi Sr Product and Portfolio Management (Automation Innovation)| DXC Technology Mckinney, Tx, United States
Thanks for sharing.

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