Sep 8, 2009
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Estimating Project Schedules: Setting Margins-of-Error
Estimating a project’s schedule can be a real challenge. There is potential uncertainty and unkowns to consider when creating a schedule. I’ve found it helpful to categorize projects when estimating a project’s schedule so you know what kind of margin-of-error to build into it. Three categories I find useful are:
- New Work
- Old Work
- Combo Work -Combination of New and Old
New work is an effort or process you’ve never done before. This could be using a new technology, an upgraded tool, developing a new type of solution, implementing a new program or designing an entirely new asset e.g. a website, if you are used to designing print pieces.
Old work is an effort or process you’ve done many times before with the same tool set.
Combo work is a combination of new and old. This could be doing a standard project using a new tool or technique or working on something you’ve done before but which you wouldn’t call yourself an expert at just yet.
MARGIN-OF-ERROR
Each of these categories carries a different degree of uncertainty. You can capture that uncertainty by creating a margin-of-error for your schedule estimates. Here are some guidelines for margins-of-error.
- New Work - a margin of 8x.
- Old Work -a margin of 1.5x
- Combo Work -a margin of 4x, though you can shift that higher or lower, depending on how much is new vs old.
DON’T FORGET CLIENTS
Clients are another element to consider when deciding what category to put a project into. Doing work for a new client or a new contact person at the client can add as much uncertainty as using a new tool or developing a new solution.
