Project management

PROJECT BUDGET ESTIMATE

Presented by seyam bacha

Project budget estimation
What Is Budget
 Budget is an estimate of cost ,revenue, and resources
over specified period of time.

What Is Estimate
 Estimation is approximation ,predication based on
experience information available .
Budget estimate
Budget estimate
 Approximation of the cost of an activity, program ,or
project, prepared for budgeting and planning purpose
 A project budget is detailed, time phase estimate of all
resource costs for project
 Budget estimates are obtained from the people
responsible for managing the work effort.
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 We typically develop a budget in stages from initial
rough estimate to a detailed estimate to complete
approved project budget
 Estimating project budget need to take in account all
corresponding taxes ,fees or other expenses
Types of budget estimates
 There are three kinds of budget estimate that occur
during project cycle .
1. Rough Estimate
 Project manager develop the first budget estimate
used before or during the project initiation .
Its quick estimate
 It's provide rough idea of project budget.
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 Definitive estimate
 It is the most accurate estimate but take the most time
to create.
 The definitive estimate make use of work break down
stricture .
 This estimate is used during the planning stage.
 But used through out project life cycle and update
regularly when information is available.
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 Contract estimate
 More accurate it is formulated late in project
initiation stage
 A contract estimate is quick but not very accurate
 It is based on analogous estimating
Method to estimate project budget

1. Analogous
2. Top down
3. Bottom up
4. Parametric
Analogue

 Analogous
 This technique used the actual cost of previous similar
project for the basis of estimating current project
 Less costly
 Less accurate
Bottom up
 Estimate require estimating individual activity and
cost of each input and adding them to get project total.
 Work break down is used to identify activity .
Top down
 It is budget estimate when the total project budget is
known and project need to know the cost of individual
activity.
 Project may decided to increased or decrease activity
fixed budget is broken. down used wbs.
Parametric estimate
 Parametric estimate used standardize parameter that
define cost of activity .
 This estimate technique is mostly used in construction
project .
 Parametric project is determine by identify unit cost.
 thanks