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Oftentimes, software development projects exceed their time estimations, which results in lost revenue, enlarged budget, and missed market opportunities. To avoid such unwanted consequences, project managers should have a practical approach to assessing the duration of the project. We’re going to share a structured approach that will help project managers to nail software development time estimation. You can use this comprehensive approach as a universal guide to adjust the accurate time estimation for your development process.

But, before we jump to conclusions…

The importance of time estimation

Time is a commodity everyone needs so desperately, but there’s never enough of it. Thus, a software development project cannot go on forever. Estimating time is beneficial to both software vendors and clients.

For the vendor:

  • to determine what to prioritize
  • to implement resources based on the time estimate

For the client:

  • to picture the entire scope of work and determine the launch date accordingly
  • to estimate the cost linked to software development
  • to plan for acceptance testing, product launch, and other things accordingly

As you can see, estimating software development time accurately is beneficial to everyone associated with the project. That said, correctly estimating time is quite a difficult task but we should do our best to do it properly.

Here’s how you can get better at estimating the software development project.

Understand what’s required

Always start with identifying the desired outcomes. You can list each required task in detail, perform a company requirements analysis, design a specialised plan, and update it with a joint effort.

Make an estimation for each activity

List all your identified activities in the order they’re meant to happen.

Estimate exactly how many hours it will take to complete each individual activity you’re going to perform. Once you have an estimated time, define the essential deadline milestones and make sure you’re armed with the resources and instruments required to finish the given tasks.

Be sure to make allowance and set time for these points:

  • Emergency cases
  • Unpredictable situations
  • Administrative work
  • Potential issues with equipment
  • Training
  • Meetings
  • Communication with your stakeholders
  • Obtaining crucial technical resources
  • Sick leaves, vacations, and holidays of the key team involved
  • Code reviews
  • Additional tasks with top priority

With all these considered, you’ll make your software development project estimation more effective compared to bare assumptions. While these aforementioned points may extend your overall project frames significantly, it’s always better to know what you’re going to do rather than tilting at windmills.

Determine who needs to be involved

Panel discussions and group brainstorming are more useful than making individual decisions. Allow the contributions to come from those who will actually do all the hard work. Set your project schedule. Herein, you’ll incorporate the lists of activities, description of your project’s scope, personal and project calendars, resource requirements, possible risks, etc. You can also include a critical path for the defined project.

Oftentimes, software development projects exceed their time estimations, which results in lost revenue, enlarged budget, and missed market opportunities. To avoid such unwanted consequences, project managers should have a practical approach to assessing the duration of the project.

Compare to previous projects

This is where you should compare your current project to the spent man-hours on a similar old project— not the initially determined scope. There is also a complexity factor, which you should define and multiply by man-hours estimated.

Include a risk buffer

You should include a risk buffer of 5-25% of the entire project time based on the complexity of the project to avoid common risks:

  • Issues hard to foresee (e.g., bugs and crashes when the user base starts to grow, integration issues, etc.)
  • The unpredictability of modern technologies (e.g., using a third-party API preferred by the client)
  • Conflicts inside the team that further reduce productivity (e.g., two experienced programmers with unique skills have two different opinions on the same subject)

Part-time resources

Let’s say you only have 80% of your IT resource availability and your JS developer works 32 instead of the usual 40 hours per week. Be sure to apply this 80% to your milestone dates planning, not the estimate itself. Therefore, you estimate 40 hours, but tell the client that the task will be finished in 6, not 5 days, allowing you to secure potential sick leaves and other unexpected errors as your development project is being undertaken.

Review estimates after the launch

Assess all the pros and cons of your project estimation post-factum.

If something went wrong, investigate why it happened and identify what can be done to avoid such errors in the future. This will help you sharpen your skills for future projects.

Bonus tip: externalize estimation

If the person who’s trying to do the estimation doesn’t have the required knowledge or background to perform it or isn’t familiar with how to estimate time for a project, he or she can consider an external team, as it is extremely crucial to have a solid estimation.

There are mostly two different phases where cost estimation is computed:

  • During the initial discussion when the client’s requirements are gathered
  • After having a universal idea of their requirements, you do the first estimate, which is improved at a later stage when the actual development planning phase begins and you have a better understanding of what’s going to be executed

Remember, the more comprehensive the requirement is, the more solid the estimate; it also provides a more accurate technical specification.

Being inaccurate with estimates can result in vastly negative outcomes for the company you work for. So, for the sake of your business’s future, as well as your own, it’s better to stay more accurate while forecasting the hours a given task will require.

Note that once you have determined an estimate and started a project, it’s probably too late to make new changes. The only possible way to get better at estimating is to practice and utilize historical data to define future predictions.

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