Practical Software Estimation Measurement

New Video: Estimation Spreadsheet vs. Top-Down Tool: Which Is Better?

In most organizations, spreadsheets play a vital role for a variety of uses, from time keeping to budgeting to even estimating software development releases.  They offer a level of familiarity - most of us cut our technical teeth on spreadsheets from a young age and have grown with them as we advanced our careers.  When it comes to estimating software development, spreadsheets are a common “go-to,” but an estimation tool offers more flexibility, timely “what-if” changes and far less complexity for new and seasoned estimators alike.

Have you ever been in an organization in which the estimation spreadsheet was so complex and cumbersome that only a select few knew how to use it?  This leaves an organization vulnerable to perhaps a single link of institutional knowledge upon which they are making vital business decisions.  And if that one project manager, analyst or architect leaves the organization, switches roles, or retires, what then?  Even if they go on vacation for 2 weeks, you’re left with a spreadsheet that may have an impossible learning curve for anyone else hence delaying or possibly negating the estimates being created at all.

The notion that being able to use Excel qualifies one as a spreadsheet estimator isn’t the case due to its complexity.  Employing a top-down estimation tool offers a consistent method for estimating that is transitional to the next person assigned to the role of estimator, due to its simplicity.  Thanks to an intuitive GUI with the calculating engine in the background, a tool offers a much easier method for creating estimates without having to be a spreadsheet genius.

Another advantage of using a top-down tool is being able to create an accurate estimate with minimal inputs very early in the estimating process. Leveraging relevant industry data, combined with a few intuitive inputs, a tool can create an estimate within minutes, whereas a spreadsheet typically requires more inputs, many of which are simply unknown at the early stages of estimating.  Once an estimate is created, we often must make “what-if” scenarios to accommodate stakeholder goals for the project.  These changes can be quite laborious to play out in a spreadsheet, but in a top-down tool it’s a matter of a few clicks.

Regarding the cost, one may assume that the spreadsheet is “free” as part of a larger application, a la Microsoft Office, but there are significant labor costs with a spreadsheet. Let’s look at putting together the initial estimate. It usually takes weeks to gather all the detailed information necessary to produce an effective spreadsheet estimate. And this often must come from multiple stakeholders and systems, which equals effort hours spent before even starting the estimate analysis. Then, factor in rework when the project changes or if management simply rejects the initial estimate.

Going over budget, over schedule, or worse, a failed project can rack up huge costs!  The cost of a top-down tool requires some investment, but once you get started, the cost savings are dramatic.  Initial estimates can be generated in hours instead of weeks. Revising estimates and calculating alternative scenarios is just as quick. Factor in cost savings from hitting budget and schedule goals, avoiding disasters, unrealistic expectations, overstaffing; even uncovering money left on the table and the tool pays for itself!

If you’d like to see more of what a top-down tool can do for your organization, check out our SLIM overview or contact us for a customized demo.

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