ABSTRACT
Introduction One of the common questions a PM often gets is “how much do you think this project will cost and how long will it take?” It almost seems a requester believes this person has some magical computer in their brain that can come up with such data. There are many factors that come into play regarding time and cost estimation. This chapter will explore some of the typical procedural approaches for creating a project time and cost estimate, but be aware that estimating is an art form as much as a mechanical process or scientific formula. Every industry has its unique methods of producing their project estimates. It is also important to point out that the large majority of projects do not meet their original estimates, so this suggests that the processes utilized have shortcomings. In reality, most estimates are overrun (Verzuh 2005, 168). Some of this is caused by a poor process to start with and some is related to subsequent ineffective management of the project which in effect causes the overrun. As project management methods have matured over time, estimates are now matched more closely to the actual outcome, yet significant variances still remain.
