Effort Estimation: How long its going to take?

During our development efforts or Project management times, we would have come across this question "How long its going to take?" In this blog I'm trying to discuss the concept of "Three point Estimation".


What is Three Point Estimation?
Three point estimate is best suitable for IS Application projects and it takes into account best, worst and most likely scenarios. This is based on the statistical tools.


The Scenarios for Estimation:
a. Most Optimistic - Best Scenario (Mo)
b. Most Pessimistic - Worst Scenario (Mp)
c. Most Likely - Likely to happen Scenario (Ml)


Steps to Three Point Estimation:

• Develop an Work Breakdown Structure
• Define the Mo, Ml and Mp efforts required with the help of spreadsheet
• Estimates each the E value and SD for each task.

Example:
How long it will take to develop the screen to add two numbers?


a. Mo - 5 Hours
b. Mp - 10 Hours
c. Ml- 8 Hours


Thought it can be calculated by Simple Mean which is called as Triangular Method using the formula (Mo+Mp+Ml)/3, thats not most recommended, so we go with PERT based calculation as follows.


E = (Mo+4Ml+Mp)/6


E=(5 + (4 * 8) + 10)/6=(5 + 32 + 10)/6=47/6=7.8


SD = (Mp - Mo)/6=(10-5)/6=5/6=0.8


Benefits:
1. Simple to work on the estimation, would take lesser time to estimate
2. Provides opportunity to consider best, worst and modest scenarios
3. Degree of uncertainty is also documented
4. There are no un-interpreted estimates.


Various links you can refer fore more details:
http://www.projects.ed.ac.uk/methodologies/Full_Software_Project_Template/EstimationGuidelines.shtml
http://en.wikipedia.org/wiki/Three-point_estimation