Question

Compare and contrast the use of the following three methods of conceptual estimation by researching them:

a. Analogy (top-down) estimating

b. Parametric estimating

c. Heuristic (rule-of-thumb) estimating

Answer 1

1. Analogous estimating:
   This type of estimating involves comparisons to other, similar projects or project components. Most organizations perform projects that are similar to other projects within the organization, or know the costs of projects performed by other organizations. The actual costs can be scaled on the basis of known differences to arrive at the estimate for the new project
2. Parametric estimating
   This involves starting with a unit cost and scaling it up to the number of units required. Most industries have public knowledge banks that publish cost data, for example, the cost per square foot to build a house in various cities. The parametric value can also originate in-house, if many of those types of projects have been completed.
3. Rule of thumb estimating:
   It is often intuitive to determine an optimistic and pessimistic value.  Three point estimating uses those values to “skew” the estimate if there is higher upside or downside risk, or if the estimator wishes to introduce a skew to account for risk. The estimator chooses a Most Likely estimate (normal) as well as an Optimistic and Pessimistic value. These can be averaged using the triangular distribution:

   Estimate = (a + M + b) / 3

   Or if the intention is to keep the estimate tighter to the most likely value, the beta distribution can be used:

   Estimate = (a + 4M + b) / 6

Where:

• a = Optimistic Estimate
• M = Most Likely Estimate
• b = Pessimistic Estimate

Differnce:

1.Analog estimates:

a.If your current project is similar to past ones.

b.Before taking, choose successful ones.

2.Parametric estimates:

a.This is more scientific method,which is calculated by previous activities.

b.This is a quick method but needs Robust data

c. It is hard to adjust.

3. Rule of thumb estimates:

a. It is quick method to estimate because it used breakdown structure.

b. Each task is estimates individually.

c. It is detailed work process.

d. You will receive more accurate results.