Standard Estimating Gates
A customer recently asked us for a standard set of estimating points. And among us we didn’t have an answer off the top of our heads… We looked at PMI, ITIL, COBIT, etc. and found no standard. We deal with estimating gates all the time… So how come we didn’t have any standards. It struck me that the estimating points match many of the decision gates, the development gates. So one of our PMI certified Project Managers called the PMI offices. They said they don’t mandate estimation points or gates since they are so diverse among organizations. And they suggested where there is a key deliverable, one the project cant live without, that is generally a gate.
PMI’s PMBOK states “cost estimates should be reviewed and refined during the course of the project to reflect additional detail as it becomes available and assumptions are tested. The accuracy of a project estimate will increase as the project progresses through the project life cycle. For example a project in the initiation phase may have a rough order of magnitude (ROM) estimate in the range of -25% to +75%. Later in the project, as more information is known, definitive estimates could narrow the range of accuracy to -5% to +10%. In some organizations, there are guidelines for when such refinements can be made and the degree fo confidence or accuracy that is expected” In other words PMI remains silent on standard estimation points.
So.. Here is a proposed set of standard estimation points. These gates are often tied to how an organization funds money for projects. So they need to be tailored to the governance approaches being used:
Concept Level Estimate
Just a finger in the wind to see if the idea is worth exploring or is so expensive as to be impractical.
Business Case Estimate
Estimate in the decision making phase when a project has not yet been authorized, often as part of the business case analysis.
Project Charter and Plan Estimate
Estimate that goes along with a project definition or project statement and estimates scope, objectives and participants in a project as well at the primary roles and responsibilities.
Detailed Plan & Function Spec Estimate
Project planning level where the project team prepares th estimate of how it will move forward. In Agile projects this may be the overall project estimate rather than individual sprint estimates.
Construction / Deployment Estimate
An estimate to complete of a project that is underway to help keep the project on schedule and cost.
Post Deployment Estimate
This estimate provides information for estimators and others to used such as lessons learned, actual data for calibration, etc.
Thank you for reading “Dan on Estimating”, if you would like more information about Galorath’s estimation models, please visit our contact page, call us at +1 310 414-3222 or click a button below to ask sales questions, sign up for our free library or schedule a demo.
Understanding Cost & Affordability Using SEER as a Common Benchmark, Driven By Facts
I was pleased to present at the joint CAST / Galorath event. My paper, “Understanding Cost & Affordability Using SEER as a Common Benchmark, Driven By Facts,” covers use of parametrics as a common language for describing estimation problems and solutions. It also points out how parametrics can be the basis of affordability trade-offs even when the final cost may be produced bottoms-up. Additionally it illustrates how SEER parametrics combine with data and provide traceability and confidence by the facts of prior systems. The following graphic illustrates the savings in time as well as the potential number of affordability analyses that can be done with SEER versus manually:
This briefing also touches on the Carter DoD “Better Buying Initiative” and affordability analysis to provide “will cost” analysis.
Thank you for reading “Dan on Estimating”, if you would like more information about Galorath’s estimation models, please visit our contact page, call us at +1 310 414-3222 or click a button below to ask sales questions, sign up for our free library or schedule a demo.
The Future of Software Analysis and Measurement : Expert Panel Questions & Answers
Here are some of the questions that were answered after the webinar with Bill Curtis, David Herron, and Dan Galorath. They were answered on Cast software’s Facebook page.
What about aerospace component level software and how would you apply a cost factor their complexity factors?
What is IFPUG Back Fired Points, how does it help?
Daniel Galorath Backfiring means counting lines of code then using a number of lines per function point to approximate function points. I think it is much better than nothing for a finger in the wind. Many others in the industry object strongly to it.
Another question – What type of information is needed to start using a software analysis and measurement tool?
Bill Curtis First you need to know how you want to use the results. That will help you establish criteria for evaluating which of the various tools best meets your needs. The Goal-Question-Metric paradigm is a good guide for determining what your measurement needs are.
Here’s another question from the webinar – Would like to understand how we can improve our ability to capture metrics (defect density either using effective loc and or functional point) for applications that rely heavily on database’s where the logic resides – e.g to map biz rules existing in table rows/columns etc?
Daniel Galorath Generally you would count the work involved in building the database, not the entry of the data into the database itself. SEER will provide estimates of defect density, etc. From my understanding CAST can provide measurement of this.
What is the panel’s opinion on LLOC to FP translation such as QSM language by language table which they developed from their database.
Do you have to have a technology inventory?
How do you extend the IT governance to software suppliers? what requirements to pose to them?
Bill Curtis Customers are starting to write measurable quality targets such as robustness or security targets into their outsourcing contracts as the equivalent of service level agreements. They then establish a Quality Gate where all software received is measured and evaluated before being put in operation. If the supplier’s software falls below the quality target they must remediate the code or face a financial penalty.
Thank you for reading “Dan on Estimating”, if you would like more information about Galorath’s estimation models, please visit our contact page, call us at +1 310 414-3222 or click a button below to ask sales questions, sign up for our free library or schedule a demo.
C Language Usage Appears To Be Overtaking Java Again
From Computer World Magazine: Java is losing popularity based on the latest assessment of programming languages by Tiobe Software.
The October edition of the Tiobe Programming Community Index, found that Java lost popularity in September, with an estimated 17.9 percent of developers using it as opposed to 18.8 percent in the previous month’s index.
Java still finished as the top language, but if the downward trend continues, the C language, ranked second with 17.7 percent of users, will be No.1 next month.
Good think I still have my Kernighan & Richie book on C… Vintage around 1976?
Thank you for reading “Dan on Estimating”, if you would like more information about Galorath’s estimation models, please visit our contact page, call us at +1 310 414-3222 or click a button below to ask sales questions, sign up for our free library or schedule a demo.
DoD Historical Top Line Spending
I thought this was interesting.. Showing the total spend from the US Department of Defense over time and how it correlates with lower conflicts.
Thank you for reading “Dan on Estimating”, if you would like more information about Galorath’s estimation models, please visit our contact page, call us at +1 310 414-3222 or click a button below to ask sales questions, sign up for our free library or schedule a demo.
APMP Cost Task Force: Improving Cost as Part of Proposals to Government
I have recently accepted the chair position with Association of Proposal Management Professionals (APMP) cost task force. I will be starting up the regular telecons in a few weeks. I must admit when I was first drafted onto this task force a couple years ago I had never heard of APMP. But having worked with them and attended their last two conferences I must say I am very impressed with the organization.
For those already on the task force I will be contacting you in the next few days. For those that would like to help improve the ability for costs to reflect actuals please send me an email and get on this task force.
The charter of this task force follows:
- 1. Statement of the Issue.
There are often large differences between an offeror’s proposed cost and the Government’s realistic or Most Probable Cost. This task force will involve Government and Industry Cost experts to discuss/brainstorm possible reasons. It may require discussing or mapping each other’s processes to determine where these disconnects may be.
- 2. Goal of the Task Force Effort.
- To identify disconnects between offerors’ approaches in developing cost proposals and the Government’s approach to evaluating cost proposals (including performing realism analysis and developing Most Probable Cost).
- To minimize differences between the proposed cost and the Government’s Most Probable Cost that is due analysis approach differences (e.g., Government point estimate or a 50% probability approach vs. an offeror’s 10% best case approach.)
Thank you for reading “Dan on Estimating”, if you would like more information about Galorath’s estimation models, please visit our contact page, call us at +1 310 414-3222 or click a button below to ask sales questions, sign up for our free library or schedule a demo.
The Future of Software Analysis Measurement Webinar Featuring Bill Curtis, David Herron and Dan Galorath
We have some exciting events coming up this month with the first: The Future of Software Analysis and Measurement on October 12, 2011. I am really excited to share the virtual podium with Bill Curtis, Senior VP and Chief Scientist of CAST Corporation and with David Herron, David Consulting Groups VP of Knowledge Solution Services as moderator.
Bill and I both spoke at a software engineering conference last year and I got very excited about his work in software analysis with CAST. Besides Bill being an engaging speaker his content was very illuminating, covering issues of existing software, its complexity and reliability. He ev!–more–
en showed the number of latent defects in software of various languages. I have greatly summarized some of the a href=http://www.galorath.com/wp/software-defects-in-fielded-software-cast-analysis.phpsoftware defect conclusions /aelsewhere on this BLOG and CAST has been instrumental in recognizing and quantifying the a href=http://www.galorath.com/wp/500-billion-it-debt-for-deferred-maintenance.phptechnical debt/a
And with David Herron, one of the most knowledgeable people in the measurement community, this should be a do not miss event.
Details of the event follow as does a link to signup. Hope you can make it.
blockquotestrongThe Future of Software Analysis and Measurement/strong
October 12, 2011 8:00am Pacific, 11:00am Eastern, 4:00pm London
a href=http://www.castsoftware.com/news-events/event/future-of-sam?gad=glrClick this Webinar Link to sign up/a
Join us on October 12th to hear from an exciting lineup of experts on the Future of Software Analysis and Measurement: Dan Galorath, President CEO of Galorath Inc and Bill Curtis, SVP Chief Scientist, CAST will have an engaging discussion moderated by David Herron, VP, Knowledge Solution Services, David Consulting Group.
These industry veterans will share experiences with their client’s software development processes and discuss how Software Analysis and Measurement tools coupled with Parametric Estimation models can impact organizational performance through increased ROI, customer satisfaction and business value.
The panel will provide insightful and actionable steps that will make an immediate impact on your strategy including how to:
• Drive organization value by fueling Estimate and Measurement practices within an enterprise
• Build the funding rationale through proven economic impact models
• Establish the ROI from Estimate and Measurement practices and process/blockquote
Thank you for reading “Dan on Estimating”, if you would like more information about Galorath’s estimation models, please visit our contact page, call us at +1 310 414-3222 or click a button below to ask sales questions, sign up for our free library or schedule a demo.
NASA Study on Cost Schedule Growth
Very interesting paper covering cost schedule growth at NASA.
http://www.lpi.usra.edu/pss/presentations/200806/15freaner.pdf
This describes what really happens and why cost schedules grow. The paper points out that the technical baseline initially estimated often ends up being significantly different when it is actually built.
The paper also points out how to factor cost growth into the cost / schedule estimate.
Of course SEER can compute cost schedule growth in every project and SEER’s xippr can estimate the probability of overrun.
This paper does a wonderful job of illustrating why such growth happens and what the factors should be.
Thank you for reading “Dan on Estimating”, if you would like more information about Galorath’s estimation models, please visit our contact page, call us at +1 310 414-3222 or click a button below to ask sales questions, sign up for our free library or schedule a demo.
100+ Rules for Large Program Managers
100+ rules for project managers: http://www.altisinc.com/resources/rules/
While this list uses NASA terminology and claims to be for NASA, most items are relevant to most projects. A few are reproduced here:
Program Planning, Budgeting, and Estimating
Rule #72: Today one must push the state of the art, be within budget, take risks, not fail, and be on time. Strangely, all these are consistent as long as the ground rules such as funding profile and schedule are established up front and maintained.
Rule #73: Most of yesteryear’s projects overran because of poor estimates and not because of mistakes. Getting better estimates will not lower costs but will improve NASA’s business reputation. Actually, there is a high probability that getting better estimates will increase costs and assure a higher profit to industry unless the fee is reduced to reflect lower risk on the part of industry. A better reputation is necessary in the present environment.
Rule #74: All problems are solvable in time, so make sure you have enough schedule contingency—if you don’t, the next project manager that takes your place will.
Rule #75: The old NASA pushed the limits of technology and science; therefore, it did not worry about requirements creep or overruns. The new NASA has to work as if all projects are fixed price; therefore, requirement creep has become a deadly sin.
Rule #76: Know the resources of your center and, if possible, other centers. Other centers, if they have the resources , are normally happy to help. It is always surprising how much good help one can get by just asking.
Rule #77: Other than budget information prior to the President’s submittal to Congress, there is probably no secret information on a project—so don’t treat anything like it is secret. Everyone does better if they can see the whole picture so don’t hide any of it from anyone.
Rule #78: NASA programs compete for budget funds—they do not compete with each other (i.e., you never attack any other program or NASA work with the idea that you should get their funding). Sell what you have on its own merit.
Rule #79: Next year is always the year with adequate funding and schedule. Next year arrives on the 50th year of your career.
Thank you for reading “Dan on Estimating”, if you would like more information about Galorath’s estimation models, please visit our contact page, call us at +1 310 414-3222 or click a button below to ask sales questions, sign up for our free library or schedule a demo.
Just Say No: When Not To Bid on an Engineering or Software Project
Here are my points on when to say no to bidding on an outsource project. There is a larger presentation that should be on the APMP web site soon.
Human Nature: Don’t say No
HBR Article explains this Phenomenon:
- Problem: Humans seem hardwired to be optimists
- We routinely exaggerate benefits and discount costs
Reference: Delusions of Success: How Optimism Undermines Executives’ Decisions (Source: HBR Articles | Dan Lovallo, Daniel Kahneman | Jul 01, 2003)
- Anchoring (relying too heavily on one piece of information) magnifies optimism
- Solution: Temper with “outside view”
•Reasons to Bid with a Low Probability of Win
- A courtesy bid is a favor to the customer
- You want to give notice that you are a viable supplier
- You sincerely believe you have a strategy that can re-engineer the customer’s vision Read more
Thank you for reading “Dan on Estimating”, if you would like more information about Galorath’s estimation models, please visit our contact page, call us at +1 310 414-3222 or click a button below to ask sales questions, sign up for our free library or schedule a demo.
Project Prediction Infographic
