Maybe it’s the late, cold, damp spring we’re having this year, but my confidence in the weather forecasting crew is at an all-time low. Early spring snow storms (6-10”) have ended up being rain events. The price of being wrong for highly paid weather forecasters is negligible apparently.

The cost of inaccurate estimating and sizing of complex IT projects in contrast has an increasingly unfortunate correlation with job loss for IT executives and CIOs. Lousy estimating skills are increasingly evident in the filings of public companies as they admit substantial cost overruns and delays with major IT projects. Broken mid-market ERP implementations and web projects appear to be especially popular this year.

Finding the right balance between the eight page over engineered business case and the finger in the wind approach is not as hard as you might think. The calls that I get from clients in trouble generally come from the two extremes, i.e. “our project sizing approach takes so much effort that people check off the boxes and don’t actually estimate the level of effort” and “our team is so experienced that they think they have an intuitive feel for the project size”.  (When confronting a bear in the dark at a distance of ten feet, you need more than an intuitive feel that something might be wrong, a plan perhaps).

We coach clients to think about the scale of their estimating effort using the questions below:

  1. Am I estimating the scope for a major (enterprise) project that involves/impacts a significant part of the business or something smaller?
  2. Have we delivered a similar project in the recent past? Do we understand the enabling technologies and business processes already or are we learning on this project?
  3. Are we relying on our own team members with lots of company specific experience or outside consultants that know less about our business?
  4. Will the right resources be available on the team at approximately the right time or will you be competing with the new enterprise E-Commerce implementation for staff?

Get comfortable with asking questions of your staff about the specifics of each project estimate. A well thought through approach with a spreadsheet is often sufficient to get to a reasonable range if the “estimator” is experienced with the work components.

We’re finding more significant gaps these days with estimating skills than in prior years. An influx of shadow IT staff in the business is also creating resource allocation and scheduling problems for CIOs and IT Executives. A structured planning approach that increases the emphasis on project sizing and estimating skills is essential.