Estimating of duration, cost and schedule in project management : a review of company practice and documentation to establish how much historical data helps to enhance the estimating process

Njovu, Peter (2003-12)

Thesis (MBA)--Stellenbosch University, 2003.

Thesis

ENGLISH ABSTRACT: This study is focussed on the all-important issue of estimation and forecasting in project management. Most project managers relate the kind of difficulties they have to go through in dealing with superiors that come up with a targeted deadline for a project with a given budget but with little or no regard to due process of arriving at both duration and cost. Many projects are doomed to overrun both schedule and cost from the word go because either the project manager is not equipped to give accurate estimates or is too timid to upset the boss by saying they do not believe the project would be completed within the said duration and the given cost without compromising quality. It is well said in literature that the three pillars of any project completion are time, cost and performance. Two of the three can be predetermined and the third will normally be dependent on those two. Where there is generous time and a large budget, chances are that a good quality well considered and executed project will result. The opposite is also true. This study investigates literature on the subject and also seeks to look at the trends in estimating in practice, by way of questionnaire and physical inspections. The questions that it seeks to answer are: a) Are project managers in most companies formally qualified? b) What is their disposition to using computerised/statistical methods in estimating? c) Does the level of education affect the disposition of project managers to using computerised/statistical methods of estimation? And finally, d) What methods are project managers using to estimate duration, cost and schedule? The results of this survey show that most projects managers do not have formal training in project management. At best they have attended short courses in project management. The survey also shows that even the formally educated project managers do not think much of strictly scientific (computerised/statistical) methods of project estimation. They rather feel that getting input from experienced functional people on the separate parts of the project tends to produce more accurate estimates. There is a leaning therefore towards using past experience on similar projects to generate norms and expert advice from the relevant functions on the expected costs and durations of accomplishing the parts of the project on which they have experience. All the project managers that responded to the survey said they had formal documentation for their projects and that they kept copies of the documentation in a central place that was easily accessible. Physical checks of this fact revealed that 29% of the interviewees did not have central or well-kept databases of previous projects' information.

AFRIKAANSE OPSOMMING: Die studie plaas klem op die belangrike kwessie van skatting en voorspelling in projekbestuur. Die meeste projekbestuurders ondervind die tipiese probleem waar senior persone projekteikendatums en -begrotings neerlê, sonder behoorlike oorweging van die faktore wat tyd en koste beïnvloed. Baie projekte is dus, van die staanspoor, bestem om beide koste en tyd te oorskry. Die projekbestuurder is dalk nie behoorlik toegerus om akkurate skattings te maak nie, of andersinds ontbreek die moed om die senior persoon daarop te wys dat tydskaal- en koste-teikens slegs teen 'n verlaging in kwaliteitstandaarde bereik kan word. Die literatuur gee wye erkenning aan wat die die drie pilare van projekvoltooing is: tyd, koste, en prestasie. Twee hiervan kan vooraf vasgepen word, terwyl die oorblywende een dan 'n funksie van die ander twee word. Indien daar ruim tyd en fondse beskikbaar is, is daar 'n beter kans om goeie kwaliteit en 'n gunstige projekuitkoms te verseker. Die teenoorgestelde is ook waar. Hierdie studie ondersoek die literatuur in die vakgebied, en gee bepaalde aandag aan die tendense in vooruitskattingspraktyke deur van 'n vraeboog en fisiese ondersoeke gebruik te maak. Die vrae wat deur hierdie navorsing gestel word, is die volgende: a) Is projekbestuurders, in die meeste organisasies, formeelopgelei? b) Wat is hulle houding teenoor die gebruik van rekenaargebaseerde statistiese metodes vir vooruitskatting? c) Beïnvloed die vlak van opleiding hierdie houding teenoor die gebruik rekenaargebaseerde statistiese metodes? d) Watter metodes gebruik projekbestuurders om kostes, tyd, en skedules te bepaal? Die ondersoek bevind dat die meerderheid projekbestuurders nie formele opleiding in projekbestuur het nie. Ten beste het hulle slegs kort kursusse in projekbestuur bygewoon. Die studie bevind ook verder dat selfs formeel opgeleide projekbestuurders nie ten gunste van streng wetenskaplike (rekenaargebaseerde statistiese) skattingstegnieke is nie. Hulle voel dat die insette van ervare funksionele personeel wat op verskillende elemente van die projek werk, meer akkuraat is. Daar is dus 'n neiging om eerder vorige ondervinding op soortgelyke projekte te gebruik om norme vas te stel, en om kundige spesialiste se raad te gebruik by die skatting van koste en tydsduur met betrekking tot die gedeeltes van die projek waarin hulle spesialiseer. AI die projekbestuurders wat aan die vraeboog-opname deelgeneem het, het bevestig dat hulle formele dokumentasie rakende hulle projekte byhou, en dat kopieë op In toeganklike plek sentraal beskikbaar gehou word. Die fisiese ondersoek bevind dat 29% van die persone waarmee onderhoude gevoer is, nie projekrekords van vorige projekte op In sentrale databasis bewaar nie.

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