"Why are you over schedule? Your estimate said 93 days and we are on day 97!"
In planning your project you are forced to come up with estimates. These estimates are best guesses and often highly uncertain. Unfortunately you may be held to those estimates further on in your project.
To improve stakeholder and customer understanding of your estimates, your estimates should also convey the level of uncertainty present in the estimate. If the estimate shows a level of uncertainty which is unnaceptable to the customer, the customer can either accept that risk or ask you for better estimates. Giving the customer an understanding of the uncertainty of a project at the beginning can avoid many problems at the end of the project.
So here are three simple ways to present the uncertainty in the estimate of your next project - and hopefully relieve some estimate meeting pressure.
If you heard these estimates for the same project, which would you consider to be more precise?
If the project actually took 101 hours (12.6 days, 2.5 weeks), do you instinctively feel that some of the estimates were more accurate than others?
Generally, when you use a larger unit to express your estimate, your audience will automatically assume a greater uncertainty in your estimate. As you want to accurately convey larger uncertainty in larger estimates, you should use the largest unit you can to present your estimate.
TaskTrakz project management software automatically displays estimates in appropriately sized units. Hovering your mouse over the estimate will reveal the fully detailed estimate.
If you saw these cost estimates for a project, which would you consider to be more precise?
If the project actually cost $109.65, would you consider the first estimate to have been accurate? What about the second?
People automatically assume that there is a certain leeway implied when you give a large rounded number. Conversely, if you give a non-round number people will assume that it is precise down to the given level of detail.
When you want to convey uncertainty when giving estimates, and you do not have a choice of units, choose a round number close to your calculated estimate to accurately convey the level of uncertainty present in the estimate.
The ultimate in presenting the uncertainty inherent in your estimate is to present your estimate as a range. When you give an estimate as "5 to 7 weeks" you are clearly indicating that you have good confidence in your estimate. Just as clearly giving an estimate as "from 1 to 11 weeks" indicates that there is a large amount of uncertainty in your estimate.
"5 to 7 weeks" is a two point estimate, it gives a low and high point. Sometimes it may be helpful to provide a third point in your estimate, "from 5 to 7 weeks, most likely 5 weeks". This allows you to indicate that the most likely outcome is 5 weeks, not 6 weeks as may be implied from the two point estimate.
Giving estimates as a range clearly demonstrates the level of uncertainty in the estimate to the audience. Often the level of uncertainty may be unacceptable, but then reasons can be given to support it, including asking for more time to investigate and provide a better estimate.
TaskTrakz allows you to estimate each task in a projects work breakdown structure using one, two or three point estimates. This lets you automatically incorporate uncertain estimates into your projecct planning.
You should always try to communicate the uncertainty in your estimates as well as the estimate itself. So next time don't just total up your task estimates and give the customer a raw number. Estimates that show uncertainty are as simple as giving a range, choosing appropriately rounded numbers, and expressing them in appropriate units. Communicating uncertainty helps to set stakeholder and customer expectations and can reduce pressure if things go wrong while executing your project.