Three-point estimation: Difference between revisions

Revision as of 21:30, 5 July 2020

Revision as of 10:16, 8 June 2021

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To produce a project estimate the project manager:

* Decomposes the project into a list of estimable tasks, i.e. a [[work breakdown structure]]

* Estimates the expected value E(task) and the [[standard errordeviation]] SESD(task) of this estimate for each task time

* Calculates the expected value for the total project work time as <math>\operatorname{E}(\text{project}) = \sum{ \operatorname{E}(\text{task})}</math>

* Calculates the value SESD(project) for the standard error of the estimated total project work time as: <math> \operatorname{SESD}(\text{project}) = \sqrt{\sum{\operatorname{SESD}(\text{task})^2}}</math> under the assumption that the project work time estimates are [[correlation|uncorrelated]]

The E and SESD values are then used to convert the project time estimates to [[confidence interval]]s as follows:

* The 68% confidence interval for the true project work time is approximately E(project) ± SESD(project)

* The 90% confidence interval for the true project work time is approximately E(project) ± 1.645 &times; SESD(project)

* The 95% confidence interval for the true project work time is approximately E(project) ± 2 &times; SESD(project)

* The 99.7% confidence interval for the true project work time is approximately E(project) ± 3 &times; SESD(project)

* Information Systems typically uses the 95% confidence interval for all project and task estimates.<ref>[[68-95-99.7 rule]]</ref>