January 26, 2004 Program Summary
by Justine Nielsen and Adele Sommers

Share and Compare Notes & Ideas:
Tools and Techniques for Estimating Projects

This lively event offered attendees the opportunity to find out how others plan and estimate projects. Whether the work entails a single task or an entire project, technical professionals and creative content developers often see estimating as a formidable task fraught with uncertainties and assumptions.

Puzzled about estimatingStarting with a project overview, breaking it into smaller tasks and generating a project worksheet makes the daunting task of estimating more manageable.

In this relaxed and informative exchange, we pooled our wisdom and experience to begin formulating a set of estimating “best practices,” which are now being posted on our Web site. We began with a round-robin during which attendees shared their most challenging issues. Our presenters shared a wide range and years of experience to answer many of these questions:
  • Estimating is a time-consuming process. How do I make it more efficient and effective?
  • How do I approach a customer for more $$ when the project plan is revised?
  • How do I negotiate properly in the first place?
  • How do I find the hidden costs and factor in the cost of consumables?
  • How do I better define my deliverables from the outset?
  • How can I persuade clients that my work is an investment, not an expense?
  • How can I reduce my estimating stress?
  • How do I determine guidelines for metrics and milestones?
  • How much time do I estimate when it's a new kind of project or I have inexperienced staff?
  • How do I determine the value of time in each role on the project?
  • What do I do when I underbid a project?
  • How do I deal with the many unknowns and questions in the early stages of a project?
  • How do I justify the high cost of developing intangible products such as software?
  • How do I convince the client that time spent doing proper estimating is not wasted?
  • How do I handle fixed-bid contracts that must include an R&D component?
  • How do I respond to a client who underestimates the amount of effort a project will require?
  • Which time recording strategies work best?

Here are some highlights from the event:

Do your research...

Speaker Bruce MillsBruce Mills, a returning marketing consultant and graphic and media designer, presented a high-level comparison of two aspects of project acquisition: selling one's expertise and doing the actual estimating. Bruce explained that there is a balancing act between sales and estimation. The goal of sales is to get the business; the goal of estimating is to make it profitable. In situations in which the client is asking for a solution (rather than providing a specification), you must choose between being price competitive or selling your value-added advantage over price.

The sales process should ensure that the requirements and expectations are set correctly, that the client perceives the value of the deliverables, and that the contingencies are understood — all without compromising the potential margins or the ability to close the sale.

In the estimating process, Bruce recommends that you quantify the deliverables and define the scope in detail. You would next research the costs for all required tasks and expenses, and apply realistic time buffers. A comprehensive contract should include a stipulation that any changes or variables not included in the original plan will be charged accordingly. All of this should be outlined before work begins on a project.

Bruce's primary suggestion: Put it in your contract! How you track and bill any research and development time, the project specifications, and the number and kind of allowable changes and variables should all be included. Client approval is critical for a successful project completion and accurate communication.

Bruce Mills, marketing consultant and graphic and media designer, http://www.lonepinestudio.com


The "Big Guys" vs. the "Little Guys"

Speaker Mike LujanMike Lujan, a returning presenter, provided estimating and contract insight based on 20 years as a primarily self-employed technical communicator. His experience has demonstrated that the large, established companies (like Intel, Hewlett-Packard, and Cisco) usually know exactly what they want and how much they want to pay.

Although the larger companies tend to pay less than others, they do provide much of the steady, available work, Mike explained. As a subcontractor, he uses the client's specifications to develop a project proposal. Then he compares what the client believes is a fair contract rate for the project with a “fair market value” to more effectively determine if it makes sense to consider the project. He reminded us that if we don't want to take on a given project, it's likely that someone else will.

In contrast, Mike has observed that small companies often don't know exactly what they want, what it's going to cost, or what the result is worth. An independent technical communicator may spend more time teaching these clients why they need various services. Although these projects may require more work overall, they tend to allow you to inject more creativity and personality into the final deliverable — and you'll have more fun in the process.

Mike Lujan, technical communicator and SLO STC board member, http://www.mlujan.com


Compile your data...

Speaker John DalbeyCal Poly Computer Science professor John Dalbey shared a set of data collection and timekeeping worksheets designed for projects with well-defined tasks and characteristics similar to those of completed projects with stable requirements. John suggested we all start keeping real data for our current projects so that historical data can be used to estimate new ones.

Categorizing your data properly is one of the keys to creating accurate bids in the future, he explained. Examples of historically reliable metrics include lines of code for software development.

John posits that each new project can probably be boiled down to a collection of known, discrete tasks that you have already performed somewhere else. Most clients will respect you if you say “I can always re-run the numbers if you want to make that change to the scope” or some other aspect of the project. A quantitative approach thus increases your professional status and credibility.

John Dalbey, professor/lecturer in the Cal Poly Computer Science Department, http://www.csc.calpoly.edu/~jdalbey/

John's tools can be accessed via the link in the tools and handouts section below.


Communicate clearly from the beginning...

Speaker Adele SommersSLO STC President and technical communication contractor Adele Sommers presented a sample estimating worksheet as well as a list of estimating tips and techniques. These documents contain a variety of issues to consider when preparing an estimate or service agreement.

Adele suggests that documenting your estimating variables explicitly can help control scope creep. Task breakdowns on service agreements can be used to quantify the number of expected trips, reviews, telecons, pages, modules, iterations, or anything else that could characterize your project. Making healthy use of caveats, constraints, and assumptions can help define the dividing line between future in-scope and out-of-scope requests.

Another key point: Sometimes a review process can take on a life of its own, especially when several reviewers are providing conflicting inputs, she observed. Whenever possible, regardless of the number of reviewers, strive to establish a single client contact who will have the final say on the content. If having a single approver is not possible, try to factor in the anticipated number of reviewers as an explicit component of your estimating formula.

Adele Sommers, technical communication contractor and SLO STC president, https://slostc.org

Adele's handouts can be downloaded from the tools and handouts section below.


To access tools and handouts: (Need Acrobat Reader?)

The following links are also available in our Web site's Library of Best Practice Tools:

Recommended Reading:

Photography by Mary Meyer.


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