The last in section in how to estimate or the estimation techniques is how to estimate better. I mean as a human being we are not good at estimation we cannot forecast we don't know what is going to happen in the future about for forecasting estimation is bad, but still we need to do it we cannot just jump into the project or a program or even in our life without having a clear estimation that what could be kind of figures that we are looking at. Most importantly is a work breakdown structure. This actually tells us that if we know our project, it is tell it tells us that we have a baseline to start a budgeting. We have a plan to identify the estimates because this is work breakdown structure. Knowing your project.

It means you have a you have a plan you have you Need to Know Why are you estimating you know the kind of the estimates you are actually looking at once you are into you are actually driving around town structure, you know all these information your willingness is there to identify the estimate then obviously, as a project manager you want your estimates to be dead on target, you want to make sure that it is accurate to hundred percent, but this cannot happen. So, you need to look for alternatives better have a better answers, you may get wrong estimates if you try to put the hundred percent of the productivity in this is something not possible to look for some somewhere 75 to 80%. I mean, I usually go for 60 to 70% because there are risks involved, there are uncertainties involved, specifically with the new technologies.

So we need to make sure that our confidence The system even the best estimates contain some degree of uncertainty. We need we need to have this confidence level, but uncertainties there we will tell them that we are plus minus 5%. Or in we can say sigma three or a sigma one that is a confidence level we have on our project, the sigma and more very important that when you are working with your estimates, always get an expert view make sure that you have a third eye looking at your estimates somebody who is unbiased towards your estimates because you as a project manager is biased to get the best estimates out and your team wants to save their backs. So, do you need to have although this is your job to make sure that you ask the questions. Obviously, you don't want to push them you want them to take the responsibility it should be a collaborative and trustworthy The environment, but you need to look for alternatives.

So when you will question them, they might come up with a better idea that what would you do? Why you are not? I am not confident I'm not going to your proposal, please come up with something new. Don't forget the project management activity, the cost of quality, you may have additional quality timelines that you activities that you need to put in because you have a project then there is a project management activity and then based on the quality requirement, then you might have additional requirements and additional activities and cost additional cost for both schedule and cost will hit communicate the assumption the level of understanding of the project, what are your assumptions, why are you assuming that this project will take this? What has happened before all these information communication needs to be clear, fair, and size and open, you need to talk with your stakeholders you need so that they could help you.

Maybe you are saying my assumption is this and then the question you Why, why is this I do not receive this document and we have that document so if your communication with your stakeholders are open and clear, you will be in a better form an ironclad deification state where you can get you can give them better results. The work breakdown structure do question don't push your team understand your team resources, labor's materials equipment, financial resources, project management quality and other general activities communicate your assumptions risk and contingency reserve analysis. Don't forget that three point estimates are very important. bottom up estimations are very important. Then you have confidence level and tolerance level what is your threshold and define that we are okay with two to 5% variances and you will be looking at because you cannot get on the target it is not impossible. I mean next to possible is To get that you use a five days and five days in seven days and seven days and all the all the activities on the project it is not gonna happen.

Make sure you have tolerance levels make sure you have threshold figures get the third party estimate fresh eyes expert judgment, this will definitely help you get the getting a better estimates when you are talking about West when you will try to get the estimate for your project. This is where we close the discussion on estimation. I hope by now you are clear on all the four formats of estimation which is analogous. bottom up parametric and three point estimates. Why we are going to use it analogous and top down quick, easy fast. parametric when you can extrapolate when you can know that the thing type of of the work is saved.

So, one day will equal to 180 and one square foot can be 3600 square foot bottom up timely, time consuming, costly, but obviously your confidence level is very high, you can confidently tell that what is going to happen because it is it depends on the one breakdown structure which is a deliverable. If you know your deliverable if you know what you are going to deliver obviously, this will give you the better estimate. Then in three point estimates, you have two kinds of estimates one is a triangular distribution which is a simple division of optimistic pessimistic and most likely, which is optimistic plus pessimistic plus most likely divided by three, it will average out all the risk and everything and will give you the calculated buffer which is required based on the risk that you have, then you may have the beta distribution or a normal normal distribution or a bell curve or and also this is called pert analysis were optimistic plus four of most likely plus one of pessimistic divided by six will actually tell us that we have we are confident that mostly we will finish our work in the range of most likely.

We also look at that if the results most of the data points are between most likely and the A between optimistic and most likely it means you have already padded up your unnaturally padded up or and without any mathematical background or without any risk identification. You have padded up and if your question is, if your data points are between most likely and pessimistic, it means you might need to go back and reassess your risks. And this will give you the reserve analysis in terms of results for activities for work package level for the project and you have a project baseline Cost baseline which is available to you a budget which is available to you under the cost baseline which has a management reserve which is known as an unknown unknown contingency reserves is for known unknown you know the rest you don't know the impact and management results is unknown unknown.

You don't know what's gonna happen and you don't know what is gonna impact contingency reserves is available to you non management reserves is not available to you, you need to get an approval for them. Thank you very much for your time. We'll see you in the next session. Good luck.