# Analysing Basis of Estimates for Projects

### Analysing Basis of Estimates for Projects

There are times that you need to come up with estimates for projects. When you are trying to determine the total amount that each activity in your project will cost, you need to let stakeholders know why you have arrived at that particular estimate for your project. You can only do that by creating the basis of estimates for your project. That is exactly what I want to show you how to create in this article. Basis of estimates for projects are supporting and additional information needed to justify cost estimates.

Details of this basis of estimates can include the project scope, justification for the estimate, assumptions /constraints, confidence level of the estimate, and expected range of estimates among others.

Here are some of the advantages and disadvantages of estimating techniques for projects.

### #1 ANALOGOUS ESTIMATE

This ensures that no work is inadvertently omitted from work estimates. It can be some times difficult for lower-level managers to apportion cost estimates to the project when an analogous estimating estimate is adopted. This is due to the fact that it requires historical experience to use it correctly.

### #2 BOTTOM-UP ESTIMATING

This is very accurate and gives lower-level managers more responsibilities when using this kind of estimating technique. It may be time-consuming and can be used only after Work Breakdown Structure has been well defined.

### #3 PARAMETRIC ESTIMATING

This is not time-consuming as you just need to use calculator or any other software for the estimation. They just have to input the figure into a software . It may be inaccurate depending on the integrity of the historical information used for the estimation.

Now your take on this argument.

We would also like to hear what you feel about the topic we discussed today. Your feedback is very important to us. Feel free to drop your comments and recommendations. If you have a contrary opinion, you can drop that too.

These E-Books contain formulas that have helped many of my students to nail the PMP Exam at first attempt! You can also make use of this E-Books. If you have any question while using the material, feel free to shoot me a mail. I am committed to assisting you to nail your PMP exam. It’s a pledge. You can always count on me as a friend.

PS: For like seven years since I started blogging I have tried many platforms and tools. Some worked and some of them performed below expectation. Here are some of the tools that I will gladly recommend for you any day, any time.

BEST AUTO SEO FOR JUST \$1

BEST HOSTING AND DOMAIN SERVICE

BEST HOSTING IN NIGERIA (AFFORDABLE)