- At this point, what would you do if you were the project manager?
As I project manager, I would present all the data & numbers collected from bottom up approach on time and cost estimates for the deliverables. I would make it clear that project cost is overrun around 20% by $1250000 and time is four months over than estimated by senior management. I would tell them that initial estimates were made on macro level however as per estimates at work package level I would need more time and money, for this project to be a success. Bottom up cost and time estimate is done by experienced and knowledgeable people working on project.
- Was top management acting correctly in developing an estimate?
No, top management decided on cost and time of this project at macro level and only considered major deliverables, product launch date & cost estimate based on prior experience. They based their estimates on top down approach without getting any input from people doing the work
- What estimating techniques should be used for a mission critical project such as this?
The best estimating technique would be to use bottom up estimates at the work package level. This way we can check resource requirement from people doing the work and who are most knowledgeable. Then, the time, resource and cost estimates from the work package can be consolidated into networks, schedules and budgets that are used for control. The bottom up approach also provides the customer with an opportunity to compare the low cost, efficient method approach with any imposed restrictions.