1 Awesome Trick to Accurately Estimate Time - Project Management Made Easy
New to the world of project management? Don't worry - we've got you covered. Tune in every Friday to become a project management superhero! This weeks lesson is all about getting your Time Estimation right. If you'd like to check out Easy Projects, you can sign up for free here: www.easyprojects.net FREE Project Management EBOOK for new project managers.DOWNLOAD HERE: http://www.easyprojects.net/ebook/ Don't forget to check out our Blog on project management to learn more: http://www.easyprojects.net/blog/ Transcript: As a project manager, there’s only one thing that you have to get right about a project. Time estimation. So why is it so difficult for us to get this right? What is time estimation? Time estimation basically allows us to accurately predict how much time a project will take and subsequently how many resources we’ll need for the allotted time. According to the Harvard Business Review, most project managers suck at this. One in six IT projects have 200% average cost overrun and a 70% schedule overrun. As a result, projects fail. A lot. Why is time estimation important? Time estimation sounds like it’s the easiest thing in the world, but it’s actually one of the hardest things because of one major factor: You are not in control. You’re dependent on your team to get things done. One phase of a project may rely on another phase being completed on time, so if even one thing goes wrong, the entire project has a chance of failing. Time estimation is also important because it helps to sort out the Earned Value Analysis or Project Health. EVA takes into account your project progress, estimated hours, actual hours and provides you with a visual indication of your project performance. Best Practices At Easy Projects, our development team plays poker. Actually it’s called planning poker. Planning poker is a technique that gets everyone involved in the project to estimate how long the project will take. We sit in a circle, write our hours down on cards, and place them face down on the table so that no one else can see. We then go around the table and discuss the reasoning behind the highest and lowest presented time estimates The whole point is to avoid cognitive bias, called anchoring. We don’t want the first number spoken aloud to affect everyone elses time estimates. The process is repeated until there is a consensus. Once the team starts working on the project is mandatory for them to log their time in Easy Projects. It is difficult to track things at the end of the day or at the end of the week. The best option is to have a live timer for each task, which is what we use here! [image of timer in EP] For precise time logging, each time slot can only be 2-3 hours. For example: “Marketing Collateral: 8 hours” Only makes sense for payroll. Ideally, time logs should look like this: "Brochure design: 3.5 hours" "Website update: 2 hours" "Drafting newsletter: 2.5 hours" Actual Time Tracking actual time prevents us from going over budget. When the team is logging their hours, we can easily run the numbers at the end of the day and see if we’re at risk of going over budget. Added Bonus: Historical Data for Future Planning The history of Estimated and Actual Hours for the completed projects is invaluable as a forecasting tool. There are many great use cases for it. Here are just a couple: Sometimes a new project comes along that is similar to what you already dealt with in the past. By reviewing the estimated and actual hours from the previous project you can learn from the past planning mistakes (if any) and provide a more accurate and realistic estimation this time. If you let the team members responsible for the tasks do their own estimation (which, by the way, is a very good practice), after a while you can learn how accurate they are with their estimates and add an appropriate amount of “padding” to their assessments. For some reason it’s always “add” and never “deduct”. Time estimation is the single most important area when it comes to succeeding as a project manager. If you get this wrong, you’re in the wrong business. Try applying some of the practices I shared in this video with your team and let me know how you do. So, for your next project, give Planning Poker a shot and let us know how it turns out for you!