Four estimating techniques
| Technique | How it works | Accuracy / effort |
|---|---|---|
| Analogous (top-down) | Use a similar past project's actuals + expert judgement. | Fast, least accurate |
| Parametric | Statistical: rate × quantity (e.g. $50/m² × 200 m²). | Accurate if data is good |
| Bottom-up | Estimate each work package, then sum. | Most accurate, most effort |
| Three-point | Combine optimistic (O), most likely (M), pessimistic (P). | Accounts for uncertainty |
Three-point formulas (PERT)
| Quantity | Formula |
|---|---|
| Triangular (simple average) | (O + M + P) ÷ 3 |
| Beta / PERT (weighted) | (O + 4M + P) ÷ 6 |
| Standard deviation | (P − O) ÷ 6 |
| Variance | ((P − O) ÷ 6)² |
Example: O=8, M=10, P=18 → PERT = (8 + 40 + 18) ÷ 6 = 11; std dev = (18 − 8) ÷ 6 ≈ 1.67.
Estimate accuracy ranges
- Rough Order of Magnitude (ROM): −25% to +75% (early).
- Definitive estimate: −5% to +10% (later, more detail).
Mistakes examiners test
- Using triangular when asked for PERT. PERT weights the most likely value 4×.
- Std dev with /3. Standard deviation uses (P − O) ÷ 6.
- Analogous = accurate. It's the fastest but least accurate.
Test yourself
4 quick questions — tap an answer to check it instantly. Nothing is sent anywhere.
1. The PERT (beta) estimate weights which value 4×?
Answer: B. PERT = (O + 4M + P) ÷ 6 — the most likely estimate is weighted four times.
2. Standard deviation of a three-point estimate is…
Answer: A. Std dev = (Pessimistic − Optimistic) ÷ 6.
3. Which technique is fastest but least accurate?
Answer: C. Analogous (top-down) uses a similar past project — quick, but least accurate.
4. Parametric estimating is based on…
Answer: B. Parametric uses a unit rate × quantity, e.g. $50/m² × 200 m².
Sources
- Project Management Institute — pmi.org.
- PMI, A Guide to the Project Management Body of Knowledge (PMBOK® Guide).
Study summary only. "PMP" and "PMBOK" are marks of the Project Management Institute, which does not endorse this material.