1. NESMA
WG ESTIMATION

2. Background
 NESMA 2020
Vision of expanding the playing field by collaboration
 AACE International
Association for the Advancement of Cost Engineering
International
www.aacei.org
 NESMA interactive member session April 2012
Vision of expanding the playing field by
collaboration
=> WG Estimation

3. Functional Sizing
 FSM Methods (ISO)
IFPUG, NeSMA, FiSMA, Mark II, COSMIC
 Business Needs, what to do with “points”
Benchmarking
Estimation
 Benchmarking: ISBSG
International Software Benchmarking Standards Group
=> ISO standard (based on other industries)
 Estimation: ???
=> standard (based on other industries)
Basis of Estimate: Best Practise 34R-05

4. Estimation Challenges
 Estimation Process
Consistent
Controllable
 Estimation Verification
Defendable
Comparable
 Estimation Validation
Defendable
Benchmark

5. Purpose
 Document the overall engagement scope.
 Communicate the estimator’s knowledge of the engagement
by demonstrating an understanding of scope, quality and
duration as it relates to cost.
 Alert the stakeholders to potential cost risks and opportunities.
 Provide a record of key communications made during estimate
preparation.
 Provide a record of all documents used to prepare the
estimate.
 Act as a source of support during dispute resolutions.
 Establish the initial baseline for scope, quantities, effort,
duration and cost for use in engagement control.
 Provide the historical relationships between base-lined
estimates throughout the project lifecycle.
 Facilitate the review and validation of the estimates.

6. Purpose (II)

7. High Level view-BOE
PURPOSE GUIDELINES
Software Development, Maintenance & Support, Infrastructure estimation
Prepare 1
RECOMMENDED
Estimate 2
PRACTICE
Assumptions, Conditions & Risks 3
Secure Quality 4
Finalise 5
SUPPORTING FOUNDATIONS AACE, MAIN, NESMA

8. Prepare
 Purpose
 Engagement Scope Description
Decomposes the solution into its constituent elements; the Product
Breakdown Structure (PBS)
 Methodology
Primary estimating methodology (functional size based, expert
based, analogy based, process metrics based, parametric)
 Estimate Classification
Cost Estimate Classification System, AACE Practice 17R-97

9. Estimate Basis
 Design
Estimate deliverables (process); architectural documents
 Sizing
Units (e.g. Functional Size, Technical Size, Support Size)
 Effort
Methods (and tools) used to convert to size into effort
 Planning
Activities, Milestones and Constraints
 Cost
Methods and sources used for determining all unit, effort,
subcontract, material and expenditures cost

10. Assumptions, Conditions & Risks
 Allowances
 Assumptions
 Exclusions
 Exceptions
Anomalies or variances to standard estimating practices
 Risks and Opportunities
Identify those elements with high or very high risk or opportunity
values related to cost, duration, quality and/or safety critical
measures
 Containments
Measures included to prevent and/or mitigate the identified risks
 Contingencies
Contingency covers inadequacies in complete project scope
definition, estimating methods and estimating data

11. Control & Quality
 Reconciliation
major differences between the new or re-baselined estimate and the last
published estimate
 Benchmarking
comparisons of overall estimate metrics, ratios, and factors with similar
engagements, historical data, and industry data
 Quality Assurance
 Estimating Team
 Appendices:
 Estimate Deliverables Checklist
 Reference Documents
sizing report, requirements, designs, texts, notes, specifications
 Additional Attachments (optional)
reconciliation report, benchmarking report, risk analysis report

12. PURPOSE GUIDELINES
Software Development, Maintenance & Support, Infrastructure
Estimating Level of detail
Engagement Estimate
Estimation methodology Stage, Deal
Scope Classification
purpose (FP, expert, size/type, fixed
Description (1,2,3,4,5)
etc.) price/TM
RECOMMENDED PRACTICE
Sizing Basis Effort Basis
Design Basis Planning Basis Cost Basis
Requirements delivery
(Components Working time methods and
Functional constraints,
lists, units, etc.) standby sources , units
technical service levels
Exceptions
Assumptions Exclusions Risks and
Allowances anomalies or
internal, No costs Opportunities
Not in the Basis variances on
external included for… assumptions
standard
Contingencies Management Reconciliation Benchmarking
Containments
Uncertainty, Reserve Changes to Comparisons to
cost elements
unforeseeable changes in previous similar
for mitigation
elements scope, effort estimation engagements
Estimate
Quality
Attachments Attachments Attachments Attachments
Assurance
Reviews
AACE , MAIN, NESMA

13. Practical Case
Estimating Level of detail
Engagement Estimate
Estimation methodology Stage, Deal
Scope Classification
purpose (FP, expert, size/type, fixed
Description (1,2,3,4,5)
etc.) price/TM
RECOMMENDED PRACTICE
Sizing Basis Effort Basis
Design Basis Planning Basis Cost Basis
Requirements delivery
(Components Working time methods and
Functional constraints,
lists, units, etc.) standby sources , units
technical service levels
Exceptions
Assumptions Exclusions Risks and
Allowances anomalies or
internal, No costs Opportunities
Not in the Basis variances on
external included for… assumptions
standard
Contingencies Management Reconciliation Benchmarking
Containments
Uncertainty, Reserve Changes to Comparisons to
cost elements
unforeseeable changes in previous similar
for mitigation
elements scope, effort estimation engagements
Estimate
Quality
Attachments Attachments Attachments Attachments
Assurance
Reviews

14. Plan /Schedule
 Base Document 31-08 done
 Review (1) NESMA
[45 days] 01-09 15-10 done
 Rework Version 0.3 16-10 31-10 done
 Review (2) MAIN
[45 days] 03-11 16-12 started
 Rework Version 0.7 17-12 15-01
 Review (3) AACE International
[45 days] 16-01 28-02
 Rework Version 1.0
publication AACE / MAIN 01-06

15. Acknowledgement
Working Group Estimation
 Ton Dekkers (Chair) Galorath International
 Hans Bernink ING
 Martin Eisma CGI
 Ray Sadal Capgemini
 Jelle de Vries Ordina