Analogous estimating is a top-down estimation technique for estimating the cost, resources and durations of projects (according to PMBOK, 6th edition, ch. 6.4.2, 7.2.2, 9.2.2). While it is less accurate than other methods, it can be used to produce an order of magnitude or an initial estimate. Therefore, it is a common technique during the selection or …
Analogous Estimating | Definition, Examples, Pros & Cons Read More »
When you are preparing for your PMI-ACP exam, studying formulas has probably not been your top priority so far. Although the PMI-ACP exam puts less emphasis on calculations than other certifications (such as the PMP, for instance) you should be familiar with a few formulas. As they are not overly complicated, they are ‘quick wins’ …
PMI-ACP® Formulas for 19 Agile Metrics (incl. Explanations) Read More »
When you need to estimate the cost of a project or parts of a project, you almost inevitably come across the technique of parametric estimating. This is a quantitative approach to determine the expected cost based on historic or market data. It is also a method that is used in the ‘estimate cost’ process in …
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The discounted payback period (DPP) is a success measure of investments and projects. Although it is not explicitly mentioned in the Project Management Body of Knowledge (PMBOK) it has practical relevance in many projects as an enhanced version of the payback period (PBP). Read through for the definition and formula of the DPP, 2 examples …
Discounted Payback Period: Definition, Formula, Example & Calculator Read More »
Cost of quality is a technique under the Project Quality Management Knowledge Area of the PMBOK (PMBOK, 6th edition, ch. 8.1.2.3). The concept comprises of a short- and long-term consideration of quality expressed in its two components: cost of conformance and cost of non-conformance. In this article, we will shed a light on the technique …
Cost of Quality (COQ) – Cost of Conformance vs. Cost of Non-Conformance Read More »
Estimating cost is an important process in project management as it is the basis for determining and controlling the project budget. Costs are estimated for the first time at the beginning of a project or even before a project has started. Subsequently, the (re-)estimation of the project cost is repeated on an ongoing basis to …
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During the project initiation phase (or when you are preparing for a project management exam) you will likely come across the term rough order of magnitude (ROM). The PMI’s Project Management Body of Knowledge refers to the rough order of magnitude as an initial estimate in the “estimate cost” process (source: PMBOK, 6th edition, part …
What Is the Rough Order of Magnitude (ROM) and How Is It Calculated? Read More »
If you are in the initiation phase of a project or studying the PMBOK for your PMP exam you will find this ROM Range Calculator useful. This tool helps you determine the minimum and maximum values of the range of your rough order of magnitude estimate. Introduction to the ROM Calculator There are numerous estimation …
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When you are in the process of controlling the schedule of your project, or when you are preparing for your PMP exam, you will likely make use of the Schedule Variance (SV) at some point. This is one of the key indicators of the variance analysis which is part of the earned value management of …
What Is Schedule Variance (SV)? Definition, Formula, Example, Calculator Read More »
You probably came across the cost variance (CV) when you had been reading about earned value management and variance analysis. Whether you are controlling the cost of your project or preparing for the PMP exam – being familiar with the CV is essential to master project cost management. This article introduces the concept of cost …
What Is Cost Variance (CV)? Definition, Formula, Example, Calculator Read More »