Looking for Global training? Go to https://firebrand.training/en or stay on the current site (United Kingdom)

TERMS AND CONDITIONS

Firebrand Training grants you a personal, non-exclusive, non-transferable license to access and use the site. You may download or print material from the site only for your own personal, non-commercial use. Please read our full terms and conditions.

"*The process of estimating the number of work periods needed to complete individual activities with estimated resources.*"

The definition shown above in italics is taken from the Glossary of the Project Management Institute, A Guide to the Project Management Body of Knowledge, (PMBOK® Guide) – Fifth Edition, Project Management Institute Inc., 2013

Project Management Institute, A Guide to the Project Management Body of Knowledge, (PMBOK® Guide) – Fifth Edition, Project Management Institute Inc., 2013 Figure 6-14 Page 166

Expert Judgement

**Analogous:** uses data from similar/past projects

**Parametric:**

- Using metrics or historical information we know that 50 bricks can be laid every hour
- Our construction estimator has said we need 5000 bricks for this wall, therefore we need 100 hours

**3-point estimate or PERT**

- Uses 3 estimates (optimistic (O), most likely (M), pessimistic (P))
- Triangular distribution = (O + M + P) / 3 – used infrequently
- Beta Distribution = (O + 4M + P) / 6 – use most often

- Involve the team, project managers and work package owners.
- Examine historical information and previous practice
- Decide how you want to quantify the work
- Don‟t forget resource requirements and capabilities
- Determine which estimation method to use
- Modify constraints and assumptions from other planning processes
- Verify accuracy of estimates
- Consider the need for time reserves

**PERT technique (Project Evaluation & Review Technique)**

Uses three estimates, to define an approximate range for an activity‟s duration

Σ = Expected Time or Expected Duration

O = Optimistic P = Pessimistic M = Most Likely

**Sigma σ**

The standard deviation of an activity

- Degree of variation from the average - (mean)
- Indicates the standard error in the estimate and provides an idea of its accuracy
- the larger the standard deviation (spread between the optimistic and pessimistic estimates), the larger the risk in the estimate

± 1 standard deviation = 68.26%

± 2 standard deviations = 95.46%

± 3 standard deviations = 99.73%

± 6 standard deviations = 99.999998% - also known as Six Sigma

**Normal distribution curve**

- Standard Deviation = σ
- How close the data points (measurements) are to the mean (m) when plotted on a graph

Variance of the activity = square of the standard deviation = Sigma squared

Variance and the standard deviation measure variability, and are measures of how spread out a distribution is (from the mean)

**Another term** – heuristics (simple rule of thumb) – six sigma is an example

Your project has a critical path equal to 30 days and a standard deviation of 2½ days.

What will be the earliest finish and latest finish estimates for this project within a 95% confidence level?

The question gives you:

- a standard deviation of 2½ ,
- your confidence level is 95% which is two standard deviations,
- therefore you multiply the 2½ by 2 to get 5.

You add the resulting 5 to the project duration to give you the upper end of the variance range = 35

You subtract that 5 from the project duration to give you the lower end of the variance range = 25

Your answer:

- will be the option which states Earliest finish estimate of 25 and latest finish estimate of 35.

The PERT Duration of the Critical Path Activities, Standard Deviation (σ), Variance (σ²), Project‟s PERT Duration, and Standard Deviation (σ Project =√ Σ variances))

If all the activities above are on the Critical Path, what is the project’s mean duration and σ ?

**Answer:**

Project’s mean duration = 170.99 days and σ=10.1 days

Firebrand Training grants you a personal, non-exclusive, non-transferable license to access and use the site. You may download or print material from the site only for your own personal, non-commercial use. Read our full terms and conditions on https://firebrand.training/uk/learn/terms-and-conditions.