Project Planning and Estimation

Jothi K R
Project Estimation
For an effective management accurate estimation of various measures is a must. With correct estimation managers can manage and control the project more
efficiently and effectively.
• Project estimation may involve the following:
• Software size estimation
• Software size may be estimated either in terms of KLOC (Kilo Line of Code) or by calculating number of function points in the software. Lines of
code depend upon coding practices and Function points vary according to the user or software requirement.
• Effort estimation
• The managers estimate efforts in terms of personnel requirement and man-hour required to produce the software. For effort estimation software
size should be known. This can either be derived by managers’ experience, organization’s historical data or software size can be converted into
efforts by using some standard formulae.
• Time estimation
• Once size and efforts are estimated, the time required to produce the software can be estimated. Efforts required is segregated into sub categories
as per the requirement specifications and interdependency of various components of software. Software tasks are divided into smaller tasks,
activities or events by Work Breakthrough Structure (WBS). The tasks are scheduled on day-to-day basis or in calendar months.
• The sum of time required to complete all tasks in hours or days is the total time invested to complete the project.
• Cost estimation
• This might be considered as the most difficult of all because it depends on more elements than any of the previous ones. For estimating project
cost, it is required to consider -
• Size of software
• Software quality
• Hardware
• Additional software or tools, licenses etc.
• Skilled personnel with task-specific skills
• Travel involved, Communication, Training and support
Cost of a project
• The cost in a project is due to:
• the requirements for software, hardware and human resources
• the cost of software development is due to the human resources needed
• most cost estimates are measured in person-months (PM)
Cost of a project (.)
• the cost of the project depends on the nature and characteristics of the
project,
• at any point, the accuracy of the estimate will depend on the amount of
reliable information we have about the final product.
Software Cost Estimation
Project Estimation Techniques
Project manager can estimate the listed factors using two broadly recognized techniques –
• Decomposition Technique
• This technique assumes the software as a product of various compositions.
• There are two main models -
• Line of Code 
• Estimation is done on behalf of number of line of codes in the software product.
• Function Points 
• Estimation is done on behalf of number of function points in the software product.

• Empirical Estimation Technique

• This technique uses empirically derived formulae to make estimation. These formulae are based on LOC or
FPs.
• Putnam Model
• This model is made by Lawrence H. Putnam, which is based on Norden’s frequency distribution (Rayleigh curve). Putnam
model maps time and efforts required with software size.
• COCOMO
• COCOMO stands for COnstructive COst MOdel, developed by Barry W. Boehm. It divides the software product into three
categories of software: organic, semi-detached and embedded.
COCOMO Model
• Cocomo (Constructive Cost Model) is a regression model based on LOC, i.e number of Lines
of Code. It is a procedural cost estimate model for software projects and often used as a
process of reliably predicting the various parameters associated with making a project such as
size, effort, cost, time and quality. It was proposed by Barry Boehm in 1970 and is based on
the study of 63 projects, which make it one of the best-documented models.
• The key parameters which define the quality of any software products, which are also an
outcome of the Cocomo are primarily Effort & Schedule:
• Effort: Amount of labor that will be required to complete a task. It is measured in person-months units.
• Schedule: Simply means the amount of time required for the completion of the job, which is, of course,
proportional to the effort put. It is measured in the units of time such as weeks, months.

• Boehm postulated that any software development project can be classified into one of the
following three categories based on the development complexity:
• organic,
• semidetached, and
• embedded.
COCOMO Model
• Organic:
• A development project can be considered of organic type, if the project deals with developing a well
understood application program, the size of the development team is reasonably small, and the team
members are experienced in developing similar types of projects.

• Semidetached:
• A development project can be considered of semidetached type, if the development consists of a
mixture of experienced and inexperienced staff. Team members may have limited experience on
related systems but may be unfamiliar with some aspects of the system being developed.

• Embedded:
• A development project is considered to be of embedded type, if the software being developed is
strongly coupled to complex hardware, or if the stringent regulations on the operational procedures
exist.
COCOMO Model
Effort = a1 х (KLOC) a2 PM
Tdev = b1 x (Effort) b2 Months
PersonRequired = effort / Tdev
• Where

• KLOC is the estimated size of the software product expressed in Kilo Lines of Code,

• a1, a2, b1, b2 are constants for each category of software products,

• Tdev is the estimated time to develop the software, expressed in months,

• Effort is the total effort required to develop the software product, expressed in person
months (PMs).
 Effort Tdev
Mode a1 a2 Mode b1 b2

Organic 2.4 1.05 Organic 2.5 0.38

Semi- 3.0 1.12 Semi- 2.5 0.35
detached detached
Embedded 3.6 1.20 Embedded 2.5 0.32
Example
• Assume that the size of an organic type software product has been estimated to be
32,000 lines of source code. Assume that the average salary of software engineers be
Rs. 15,000/- per month. Determine the effort required to develop the software
product and the nominal development time.

Effort = 2.4 х (32)1.05 = 91 PM

Nominal development time = 2.5 х (91)0.38 = 14 months

Cost required to develop the product = 14 х 15,000 = Rs. 210,000/-

PERT

 Any project involves planning, scheduling and controlling a

number of interrelated activities with use of limited resources,
namely, men, machines, materials, money and time.

 The projects may be extremely large and complex such as

construction of a housing , a highway, a shopping complex etc.
 introduction of new products and research and
development projects.

 It is required that managers must have a dynamic planning and

scheduling system to produce the best possible results and also
to react immediately to the changing conditions and make
necessary changes in the plan and schedule.
 A convenient analytical and visual technique of PERT and
CPM prove extremely valuable in assisting the managers in
managing the projects.
PER
T stands Project Evaluation and Review
for
•Technique developed during 1950’s. The technique was developed and
used in conjunction with the planning and designing of the Polaris missile
project.
•CPM stands for Critical Path Method which was developed by DuPont
Company and applied first to the construction projects in the chemical
industry.
• Though both PERT and CPM techniques have similarity in terms of concepts, the basic
difference is; CPM has single time estimate and PERT has three time estimates for activities
and uses probability theory to find the chance of reaching the scheduled time.
Project management generally consists of three phases.
Planning:

Planning involves setting the objectives of the project. Identifying

various activities to be performed and determining the requirement of
resources such as men, materials, machines, etc.

The cost and time for all the activities are estimated, and a network diagram is
developed showing sequential interrelationships (predecessor and successor)
between various activities during the planning stage.
Scheduling:

Based on the time estimates, the start and finish times for each activity
are worked out by applying forward and backward pass techniques, critical
path is identified, along with the slack and float for the non-critical paths.
Controlling:

Controlling refers to analyzing and evaluating the actual progress

against the plan. Reallocation of resources, crashing and review of projects
with periodical reports are carried out.
COMPONENTS of PERT/CPM NETWORK
PERT / CPM networks contain two major components
i. Activities, and
ii. Events
Activity: An activity represents an action and consumption of
resources (time, money, energy) required to complete a portion of a
project. Activity is represented by an arrow, .

Event: An event (or node) will always occur at the beginning and end of an
activity. The event has no resources and is represented by a circle. The ith
event and jth event are the tail event and head event respectively.
Merge and Burst Events

One or more activities can start and end simultaneously at an

event .

Preceding and Succeeding Activities

Activities performed before given events are known as preceding activities, and
activities performed after a given event are known as succeeding activities.

Activities A and B precede activities C and D

respectively.
 Dummy Activity

An imaginary activity which does not consume any resource and time is called a
dummy activity. Dummy activities are simply used to represent a connection
between events in order to maintain a logic in the network. It is represented by a
dotted line in a network.
 ERRORS TO BE AVOIDED IN CONSTRUCTING A NETWORK

a.Two activities starting from a tail event

must not have a same end event. To ensure
this, it is absolutely necessary to introduce a
dummy activity, as shown in Figure .

b.Looping error should not be formed in a

network, as it represents performance of
activities repeatedly in a cyclic manner, as
shown below in Figure .

c.In a network, there should be only one

start event and one ending event as
shown below, in Figure .

d.The direction of arrows should

flow from left to right avoiding
mixing of direction as shown in
Figure .
 RULES IN CONSTRUCTING A NETWORK
1. No single activity can be represented more than once in a network.
The length of an arrow has no significance.

2.The event numbered 1 is the start event and an event with highest
number is the end event. Before an activity can be undertaken, all
activities preceding it must be completed. That is, the activities must
follow a logical sequence (or – interrelationship) between activities.

3.In assigning numbers to events, there should not be any duplication

of event numbers in a network.

4.Dummy activities must be used only if it is necessary to reduce the

complexity of a network.

5. A network should have only one start event and one end event.
Some conventions of network diagram are shown in
Figure (a), (b), (c), (d) below:
 PROCEDURE FOR NUMBERING THE EVENTS
USING FULKERSON'S RULE
Step1: Number the start or initial event as 1.

Step2: From event 1, strike off all outgoing activities. This would have
made one or more events as initial events (event which do not have
incoming activities). Number that event as 2.

Step3: Repeat step 2 for event 2, event 3 and till the end event. The end
event must have the highest number

Example 1:
Draw a network for a house construction project. The sequence of
activities with their predecessors are given in Table , below.
 PERT: Program Evaluation and Review Technique
• PERT is based on the assumption that an activity’s duration
follows a probability distribution instead of being a single value
• Three time estimates are required to compute the parameters of
an activity’s duration distribution:
• pessimistic time (tp ) - the time the activity would take if things
did not go well
• most likely time (tm ) - the consensus best estimate of the
activity’s duration
• optimistic time (to ) - the time the activity would take if things
did go well

Mean (expected time): te = t p + 4 tm + t o

6
tp - to 2
Vt =
Variance:Intensive 2 =on Project Management
course
6
(i) From the data given in the problem, the activity network is constructed
as shown in Figure given below
 (ii) To determine the critical path, compute the earliest time TE and
latest time TL for each of the activity of the project. The calculations of
TE and TL are as follows:,
To calculate TE for all To calculate TL for all
activities activities
TE1 = 0
TE2 = TE1 + t1, 2 = 0 + 4 = 4 TL10 = TE10 = 22
TE3 = TE1 + t1, 3 = 0 + 1 =1 TL9 = TE10 – t9,10 = 22 – 7 = 15
TE4 = max (TE2 + t2, 4 and TE3 + t3, 4) TL8 = TE10 – t8, 10 = 22 – 5 =
= max (4 + 1 and 1 + 1) = max (5, 2) 17
= 5 days TL7 = TE8 – t7, 8 = 17 – 2 = 15
TE5 = TE3 + t3, 6 = 1 + 6 = 7 TL6 = TE8 – t6, 8 = 17 – 1 = 16
TE6 = TE5 + t5, 6 = 7 + 4 = 11 TL5 = min (TE6 – t5, 6 and TE7
TE7 = TE5 + t5, 7 = 7 + 8 = 15 – t5, 7)
TE8 = max (TE6 + t6, 8 and TE7 + t7, 8) = min (16 – 4 and 15 –8) =
= max (11 + 1 and 15 + 2) = max (12, 17) min (12, 7)
= 17 days = 7 days
TE9 = TE4 + t4, 9 = 5 + 5 = 10 TL4 = TL9 – t4, 9 = 15 – 5 =10
TE10 = max (TE9 + t9, 10 and TE8 + t8, 10) TL3 = min (TL4 – t3, 4 and TL5
= max (10 + 7 and 17 + 5) = max (17, 22) – t3, 5 )
= 22 days = min (10 – 1 and 7 – 6) =
min (9, 1)
= 1 day
(iii) From the Table , we observe that the
activities 1 – 3, 3 – 5, 5 – 7,7 – 8 and 8 – 10
are critical activities as their floats are zero.
 PROJECT EVALUATION REVIEW TECHNIQUE, (PERT)

In the critical path method, the time estimates are assumed to be

known with certainty. In certain projects like research and
development, new product introductions, it is difficult to estimate
the time of various activities.
Hence PERT is used in such projects with a probabilistic method using three
time estimates for an activity, rather than a single estimate, as shown in Figure
8.22.
Optimistic time tO:
It is the shortest time taken to complete the
activity. It means that if everything goes well
then there is more chance of completing the
activity within this time.

Most likely time tm:

It is the normal time taken to complete an activity,
if the activity were frequently repeated under the
same conditions.

Pessimistic time tp:

It is the longest time that an activity would take to
complete. It is the worst time estimate that an
activity would take if unexpected problems are
faced.
 Taking all these time estimates into consideration, the expected
time
of an activity is arrived at.

The average or mean (ta) value

of the activity duration is given
by,

The variance of the activity

time is calculated using the
formula,

Probability for Project

Duration

The probability of completing the

project within the scheduled time (Ts) or
contracted time may be obtained by
using the standard normal deviate
where Te is the expected time of project
completion.
Probability of completing the
 Example
An R & D project has a list of tasks to be performed whose time estimates
are given in the Table , as follows.

a. Draw the project network.

b. Find the critical path.
c. Find the probability that the project is completed in 19 days. If the
probability is less than 20%, find the probability of completing it in 24
days.
Time expected for each activity is
calculated using the formula (5):
Similarly, the expected time
is calculated for all the activities.

The variance of activity time is

calculated using the formula (6).
Similarly, variances of all the
activities are calculated.
Construct a network
diagram:

calculate the time earliest (TE) and

time Latest (TL) for all the
activities.

From the network diagram Figure , the critical path is identified

as 1-4, 4-6, 6-7, with a project duration of 22 days.
The probability of completing the project within 19 days is given by, P (Z< Z0)

To find Z0 ,

we know, P (Z <Z Network Model 0) = 0.5 – z (1.3416) (from normal tables, z (1.3416) = 0.4099)
= 0.5 – 0.4099
= 0.0901
= Thus, the probability of completing the R & D project in 19 days is
9.01% 9.01%.
Since the probability of completing the project in 19 days is less than 20% As in
question, we find the probability of completing it in 24 days.