Predicting the Unpredictable: Pragmatic Approaches to Estimating Project Schedule or Cost
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About this ebook
If you have trouble estimating cost or schedule for your projects, you are not alone. The question is this: who wants the estimate and why?
The definition of estimate is “guess.” But too often, the people who want estimates want commitments. Instead of a commitment, you can apply practical and pragmatic approaches to developing estimates and then meet your commitments. You can provide your managers the information they want and that you can live with.
Learn how to use different words for your estimates and how to report your estimate that includes uncertainty. Learn who should—and should not—estimate. Learn how to update your estimate when you know more about your project.
Regain estimation sanity. Learn practical and pragmatic ways to estimate schedule or cost for your projects.
Johanna Rothman
Johanna Rothman, known as the “Pragmatic Manager,” provides frank advice for your tough problems. She helps leaders and teams see problems and resolve risks and manage their product development. Johanna is the author of more than ten books and hundreds of articles. Find her two blogs at jrothman.com and createadaptablelife.com.
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Reviews for Predicting the Unpredictable
4 ratings1 review
- Rating: 4 out of 5 stars4/5Anyone involved with delivering a product or a project will have to face two questions: when will it finish, and how much will it cost?The questions are straightforward and simple, they are also justified, but the answers are the source of a huge literature with a lot of books and articles, leading to heated debates and claims. And if you're dealing with a software-intensive product or a project, you already know the difficulties of making predictions about future.In this no-nonsense and pragmatic book, the author tries to look at the various aspects of predicting the timing of software projects. Given the statistical nature of the problem at hand, and the thirst for determinism of the business, she manages to clarify the concepts and draw attention to critical pitfalls. One of the things I really appreciated is the fact that author is very well aware of what kind of pressure the upper management can put on the shoulders of a software project manager: she has clearly been through such situations, and constantly focuses on how you can convey the fragile nature of ambitious of project predictions.I can easily the recommend because I think it'll useful for practicing software managers, as well as the developers who try to evaluate whether they are working with good management practices.So, as the author says, make your features small, break down that epic, go on a spike, don't multitask, put an expiration that on your estimates, always use confidence numbers for your predictions, communicate your status concretely, provide value at the end of each increment, and get to work!
Book preview
Predicting the Unpredictable - Johanna Rothman
Acknowledgements
I thank my Managing Product Development blog readers. You asked me enough questions that I had to write the answers.
I thank my editors, Rebecca Airmet and Nancy Groth. I thank Jean Jesensky for her indexing for the print book. I thank Karen Billipp for her layout for the print book.
Any errors are mine.
1. Introduction
One of the big questions in organizations is How much will this project cost?
The other question is When will this project be done?
In fact, the bigger the project, the more the people in the organization want to know.
The problem with these questions is that they are predictions. I don’t know about you, but my crystal ball is opaque. It’s never been good at predictions.
On the other hand, I’ve had pretty good results with educated guesses. I’ve had even better results with using data to update my guesses as I’ve proceeded.
Estimation has been a common problem
in software projects. I have written about it in essays and blog posts for several years. I decided if I created a book, I could share what has worked for me, in real projects and programs. You could apply these ideas in your projects and programs.
1.1 Estimates Are Guesses or Predictions
We want accurate estimates. When I drive to a local appointment longer than 10 minutes away, I want to know how long it will take me to get there. I can use a mapping application to estimate my drive, given the current traffic.
I have driven to appointments only 14 miles away, and sometimes it takes me 20 minutes to drive. Sometimes, it takes me about an hour. That’s a huge difference.
My general estimate is that I should give myself 20-25 minutes of driving time. But if I always planned on 25 minutes, I would be late—substantially late—about half the time.
We don’t want that with our project estimates. And yet, we are late
with projects.
When I drive to an appointment, I don’t add features. We often add or change requirements with projects and expect the estimate to be the same as predicted.
I don’t change who is driving—it’s always me. Yet, we change people on teams and expect the estimate to be the same.
I don’t multitask when I drive. Yet, we ask people to multitask and expect the estimate to be the same.
An initial project estimate is your best guess at the time you make the estimate. The accuracy of that estimate depends on the people doing the estimation and what they know about the project.
Your estimate is a guess, a prediction. It is not fact. If I have trouble estimating my driving time, which has far fewer variabilities than a project, how can you expect your project estimate to be accurate? You can’t, not with the very first estimate you create. You can iterate on the estimate and make it better over time.
1.2 Estimates Change
As you proceed with your project, your estimate will change. Your estimate might change because:
You know more about the project’s features/requirements.
The people understand how to work together.
You have history with these people working on this project. That history will allow you to better your prediction.
The project itself changes: adding, subtracting, and changing requirements as we learn more about what we can provide and more about what the customer desires.
Note that in my driving metaphor, my destination doesn’t change—unless I abandon my drive! Because projects change, our first estimate is a guess or prediction. That’s why it’s so important to update your estimate as you proceed.
1.3 Estimates Expire
Not only can the project itself change, which changes the estimate, but estimates have an expiration date.
On an agile project, as you finish features, you learn more about the requirements. You learn what a Minimum Viable Product, MVP, is. You might need a Minimum Indispensable Feature Set first, enabling you to create short features in flow or iterations.
If you work in a non-agile way, you will address risks—technical, schedule, or quality risks—and learn from them.
Regardless of your type of project, the estimate you create at the very beginning will expire. It is no longer valid.
Keep these ideas in mind as you read this book. These ideas are true regardless of your project’s life cycle.
I’ve collected here what I’ve written over the years to provide guidance about estimation. I hope you use it and enjoy it.
2. What Estimates Are
Managers and sponsors ask a project team for estimates all the time. Sometimes, managers use those estimates to plan which project to do first—which is a terrible idea. More on that later. Sometimes, managers use those estimates to predict a target date. Sometimes, managers use those estimates as a commitment.
None of those ways are the way we should use estimates.
Here is the problem with using estimates that way:
Estimates expire.
Estimates change.
Estimates are guesses.
Yes, guess
is the dictionary definition of estimate. The more you know about the domain, the requirements, and how the team works together, the more educated your guess will be. But it will still be a guess.
Because estimates are guesses, you can’t use them for precise prediction until you get close to the event you are estimating.
You can spiral in on more accurate estimates. You can provide a percentage confidence on your estimate as you proceed through your work. You can change your estimate as you learn more about the necessary (and unnecessary) requirements.
2.1 Provide an Accurate but Not Precise Estimate
Can you have an accurate estimate at the beginning of a project? It depends. If the project is similar to what you have done before, with a team that is accustomed to working together, and the effort is short—say no longer than three months—you have a good chance of providing an accurate estimate.
For our purposes, an accurate estimate is one that is no more or less than 5-10% off the final effort.
If you have a 12-week effort, and you finished inside of a week either way, would you consider that a good estimate? I would. That’s what I mean by an accurate estimate.
Instead, if you say, We will finish on Wednesday, the 23rd at 5pm,
would anyone believe you? They might, if you have an important demo or release scheduled for Wednesday, the 23rd at 6pm! That’s a precise estimate.
Maybe, you use that precise date as a target, a predictive estimate. You timebox the work so you can finish it by that time. That’s useful to do with trade shows, demos, and other events where you are not in charge of the date.
When someone asks you, How long will the project take?
or How much will the project cost?
they are not talking about a precise estimate. They want an