Activity the members, hence this is more accurate
Activity duration is the process of estimating the number of work hours needed to complete the development components with the resources allocated (“Estimating Activity Duration”, 2012). A project manager should have the knowledge to understand the amount of time and be able to apply best practices to save resources. Consequently, having an incorrect duration can cause an abundance of used resources, leading to a loss of money. The project budget process will need the activity duration as a basis to estimate the costs and achieve the goals of the project (“Determining Project Budget”, n.d.).
Top-down estimating is achieved by the senior management based on information about the project. The team might use historical information and prior knowledge to estimate the cost of the organization (“Top Down”, n.d.). However; this estimating method doesn’t take technical details into account which can lead to inaccurate results. This technique should be used for highly uncertain conditions, or for small projects. There are multiple methods for top-down estimating a common estimating method is a consensus method. This method uses the experience of senior managers to improve the estimate’s accuracy, instead of assigning the job to a single individual.
Bottom-up estimating is a technique in which the team members take part in estimating the project budget. This is one of the most time consuming, but accurate approach to estimating cost and duration (“Bottom Up Estimating”, 2017). There are three steps to achieving bottom-up estimating, in which the members work at the lowest level of detail in the structure. During this step, they detail the scope and deliverables each member will contribute. The next will be to develop the cost and duration estimate. After collecting the estimate, the final step would be to aggregate the estimates and determine the duration of the project as a whole. This process takes everyone’s input without forcing an estimate on the members, hence this is more accurate and contains quality information.
Both these estimating methods will initially start with a large margin of error, as additional details are known about the project estimates are more accurate. These estimates should also consider services, materials, facilities and labor costs. In my organization, we achieve a top-down estimate in which the executives decide on a budget based on their prior knowledge. However; we had to find alternative software for development due to limited resources. Having an accurate estimate for a project is crucial for a successful project.
2. Determining Project Budget. (n.d.). Retrieved December 14, 2017, from http://www.mymanagementguide.com/guidelines/project-management/cost-management/determining-project-budget/
Bottom Up Estimating. (2017, November 19). Retrieved December 14, 2017, from https://4pm.com/2017/08/17/bottom-up-estimating/
Estimating Activity Duration: An important work of a Project Manager. (2012, July 08). Retrieved December 14, 2017, from https://www.simplilearn.com/estimating-activity-duration-article
Top-Down & Bottom-Up Estimating Techniques in Project Management. (n.d.). Retrieved December 14, 2017, from https://study.com/academy/lesson/top-down-bottom-up-estimating-techniques-in-project-management.html