Bottom-Up Estimating
Bottom-Up Estimating is a widely used estimating technique that involves estimating the duration or cost of a project by breaking it down into its smaller, constituent tasks or components and estimating each of them individually. After estimating these lower-level tasks, the estimates are then aggregated to provide a total estimate for the project or larger work package. This approach often relies on a decomposition model to identify these lower-level tasks.
Overview
In Bottom-Up Estimating, the idea is to dissect the larger work package or project scope into smaller, more manageable tasks. These tasks are then estimated in terms of duration, resources, or cost. Once all lower-level estimates are made, they are summed up to produce the overall project estimate. The accuracy of Bottom-Up Estimating is generally higher compared to other techniques like top-down estimating, particularly because it focuses on detailed analysis.
Process and Methodology
Decomposition: The first step is to break down the larger work package or project scope into smaller, individual tasks or components. This is often done using decomposition models like Work Breakdown Structures (WBS).
Detailed Estimation: Each of the lower-level tasks is estimated separately, considering factors such as time, resources, and cost involved. This often involves experts or team members who have a deep understanding of the work involved.
Aggregation: After estimating each lower-level task, these estimates are aggregated to arrive at the overall project or work package estimate.
Validation and Review: The aggregated estimate is usually reviewed to ensure that all factors have been considered, and adjustments are made as necessary.
Benefits
Accuracy: As each task is estimated individually, the chances of overlooking any task-specific considerations are minimal, leading to more accurate estimates.
Comprehensive: By breaking down the work into smaller components, it ensures a comprehensive approach to estimating where all factors are considered.
Traceability: This technique provides greater traceability because you can track the estimate back to individual tasks, making it easier to manage and control.
Facilitates Risk Management: Given its detailed nature, Bottom-Up Estimating enables better risk assessment by highlighting where uncertainties or complexities might lie within individual tasks.
Limitations
Time-Consuming: Given its detailed nature, Bottom-Up Estimating can be more time-intensive compared to other estimating techniques.
Requires Expertise: Accurate Bottom-Up Estimating often requires the input of subject-matter experts for each of the lower-level tasks.
Use-cases in Business Analysis
In the realm of Business Analysis, Bottom-Up Estimating is particularly useful for projects where a high degree of accuracy is required, or the project is complex with various dependencies among tasks. It can be applied to estimate the effort required for business analysis activities, the development of business requirements, or even for evaluating the total cost of implementing a solution.
Bottom-Up Estimating aligns well with the Business Analysis core concept model, as it encourages a detailed understanding of the requirements, facilitating effective stakeholder collaboration and ensuring that the solution meets the business needs efficiently.