8 Part 8: Annex

8.1 Method References

8.1.5 Estimation Models

Usage

Performing Life Cycle Cost Calculation, Performing an Estimation

Reference

BF04, Bur03

Purpose

Estimation models form the basis of an »Estimation that is as objective and realistic as possible. The method that is used is to guarantee a traceable, reliable and accurate »Estimation of the Scope and »Estimation of Effort .

At first, the estimation objects must be specified and characterized as accurately as possible. On the basis of the structuring of the project in clear subtasks, the criteria for the impact on the estimation have to be determined and evaluated. This concerns product, project, personnel and technological characteristics. There is a large number of estimation models; however, hardly any of these models is universally valid, i. e. applicable to a variety of projects, systems and companies and at the same time sufficiently reliable and accurate for each of these fields of application.

In the following, some usual methods will be described briefly:

Estimation Formulas

The effort of an estimation object will be calculated by means of formulas that are based on empirical values.

• Function Point Analysis: This method breaks the software system to be examined down into its functional structure. The transactions (inputs, outputs, or queries) and files (external or internal data inventory) of each function shall be counted. Afterwards, a function value shall be determined based on the complexity of the individual functions. Based on learning curves, the effort can be derived from this function values, taking into account defined influencing factors.
• COCOMO: COCOMO is employed in the field of software developments and derives the effort of an estimation object from the estimated scope and defined influencing factors by means of a formula.
• PRICE: PRICE comprises a collection of estimation methods which can not only be employed in the software sector, but also in the hardware sector. The software variant is similar to COCOMO.

Expert Estimation

In this method, scope and effort of the estimation objects shall be estimated by experts. In the »Estimation of the Scope, estimation objects are derived from the »Product Structure of the project to be examined, in the estimation of effort, they are derived from the project structure. In every expert estimation, the 4-eyes principle should be observed, i.e., the person responsible for the estimation object estimates scope and effort and coordinates this with an experienced expert.

A special and widely used form of the expert estimation is the Closed Estimation Meeting, which is conducted with the participation of 3 to 7 experienced estimators. These experts will estimate scope and effort of the estimation objects independently, discuss the causes of larger deviations and agree on a joint estimation value. Signficant assumptions, like risks or degree of reuse of the estimation object, shall be documented. In a final discussion, the settling of open questions shall be specified. It is also possible to decide that the estimation values will be verified by a plausibility check, e.g., COCOMO or the Function Point Method. In a Closed Estimation Meeting, the accuracy of the estimation largely depends on the experience of the participating estimators. Thus, it is very important to select the suitable category of persons.

Percentage Method

The Percentage Method determines the effort for individual phases and activities by means of a projection based on average or recommended portions - the so-called empircal values - of the overall effort. For example, 3 percent of the overall effort of the development project will be required for configuration management. The Percentage Method is only suitable for rough estimations.