When it comes to estimating software projects, two tools prevail: the spreadsheet and the top-down tool. With critical business decisions at stake, like budget, schedule, and staffing, it's important to choose the best method. This video compares both methods through a series of basic questions. Who will be using it? Which is easier to use? Which is more accurate? And what's the cost? The answers might surprise you!
Ethan has been in software and technology account management for the last 22 years with emphasis on business development and product awareness in the software metrics measurement community. Daily responsibilities for Ethan include managing existing clients and introducing the concept of software metrics measurement to bring value to their development programs.
When it comes to estimating software projects, two tools prevail: the estimation spreadsheet and the top-down tool. It’s important to pick the right method when vital business decisions are at stake. So let’s explore: which is better?
Let’s start with one of the most basic questions: Who will be using it?
For the spreadsheet, this usually ends up being one person. When that person leaves, they take their expertise with them.
The top-down tool offers a consistent method that can be handed off to the next estimator. It’s also accessible by multiple stakeholders.
Now you’re probably wondering… which is easier to use?
If you know how to use excel, you can use the spreadsheet right?
Wrong! Believe it or not, an estimation spreadsheet can be so big and complex that only a select few knew how to use it. It’s very input-intensive and difficult to update every time something changes on the project.
A top-down tool requires some training, but after a small learning curve, it’s quicker and easier to use. With only a handful of intuitive inputs, you can generate an estimate in minutes. The top-down model makes it possible to compute and compare multiple scenarios in real time, like the impact of adding people or compressing or relaxing the schedule
Ok, but which is more accurate?
One of the perceived benefits of a spreadsheet is it allows for more planning control. However, to get a high level of accuracy, you need a lot of information that generally isn’t available at the time you need to make critical decisions.
Because the top-down approach stays high-level, estimates can be calculated early in the lifecycle. The tool also gives you the ability to sanity-check your estimates against relevant historical data. QSM’s industry database of 13,000 completed projects provides an independent view of how similar projects behave.
Sounds great, but what’s the cost?
The spreadsheet is just the cost of Microsoft Office right?
Well…did you factor in the labor cost here?
Let’s look at putting together the initial estimate. It usually weeks takes to gather all the detailed information necessary to produce an effective spreadsheet estimate. And this often has to come from multiple stakeholders and systems.
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!
So which is better? The top-down tool gives you defensible estimates quickly, when you need them, for less time and money.
This has been another estimation tip from QSM. Contact us today to find out how easy it is to implement a top-down tool at your organization.