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Top 10 Crucial steps for Software Project Estimation Success

Software project estimation is a sophisticated task requiring real experience and collaboration of various parties. Without sufficient internal resources including personnel to appropriately evaluate the software project, final results may turn out to be unfavorable, over-budget, and time wasting.

What is software project estimation?

Literally, estimation is a process to predict the time and the cost that a project requires to be finished appropriately. But in term of software development, it also means of the consideration of the experience of the software development company; the technique they employ; the process they may go through to finish the task. This whole process requires the use of complex tools and good mathematical background knowledge. It is in some cases is the accomplishment of hard work of a whole team. The error margin is, consequently, guaranteed possibly around 5-10%.

The whole process of estimation would cost the company rather considerable cost and time at the very first stage of building an app. But this will make the final result more credible, realistic, and customer-satisfying. Projects especially big ones are advisable to employ this crucial step to avoid unpredictable failure.

1. Determining the goals and commitments:

Similar to going on the road, you should be very clear about your final destination before setting off. Communicating clearly the goals or the needs of yours with the estimation team would well guide the whole process to the right place it is expected to be.

Communication of the goals clearly also allows both the estimation team and the software development company to vision the reality of all the requirements. They, therefore, would plan an appropriate timeline, personnel and employ the suitable technologies to achieve the goals in the most fruitful way. Basing on those mentioned, terms and agreements between the customers and the app developing team would be set.

2. Comprehending the functional scope of the project: 

The most essential factor for sizing a project is to determine what you want to develop and what would it reach. In some cases, there would be breakdowns in functions according to reference documentation. This lets you know in-depth about the possible extent and elements of the system which will be estimated.

However, in some cases, the estimation task become much more uncertain and complex. Then, it is necessary that the estimator should follow the following steps to get out.

  • Foster communication to enhance comprehension.
  • Learn from the existing similar system.
  • Spend more effort in studying the industry and the type of project.
  • Review the validation and prioritize created functional requirements created.

3. Paying attention to non-functional needs:

These functions focus on the “how” the project might work to meet the requirements of the customers which are usually left un-addressed when determining the functional requirements.

Followings are some of typical non-function requirements software estimation process usually left unattended:

  • Maintainability
  • Scalability
  • Security
  • Interoperability
  • Performance
  • High availability
  • Usability

These non-functional requirements may account for different importance depending on the type of project or industry. Also, the complexity and the context of different projects could vary the role of the about mentioned functions

4. Setting clear priorities:

The estimations and limits of the project as money, time, or personnel make obtaining the planned goals much more complex. In these situations, it is important to clarify the utmost importance of each functional priority in order to focus on the most essential ones.

Estimating clearly the priorities from the beginning would also keep the project more on track. Not many changes and additional requirements occur during the time of making the software, which would save a lot of time and effort.

5. Considering goals and commitments in agile plans:

Agile methodology is a contemporary developing method that allows customers and app development center to continuously communicate and make changes to their product throughout the process of developing. Iterative sprints of delivery enable customers to see their final product as well how it functions. They, then, could make modifications to their requirement which have been agreed on the previous stages. This method provides flexibility to the customers but requires the company to have a highly-skilled development team to continuously adapt to the changing needs. Also, Agile is most likely suit to the small-scale projects.

Read more about Agile methodology: Why Agile stands out as the most favorable app development method?

6. Choosing estimation strategies:

Depending on the type of project, its complexity, the information present, the number of requirements, and the delivery times of the estimation, it is necessary to think and choose the right strategy. We can look at some of these here:

There are plenty of estimation strategies that estimators could employ. But, firstly, they could take into consideration the complexity of the project, the amount of information acquired, and time constraint. An appropriate combination of those things could result in the estimating approaches as follows:

Classic estimation (expert judgment): This is likely the most common way, and it includes of selecting a requirement and allocates it a time value based on the difficulty and how experienced the estimators are in the required field. Estimation team is advised to break down the requirements into more detailed components including business, presentation, and database. Then, a suitable amount of time will be allocated for each of them. The final estimation is then the combination of smaller ones from the mentioned elements.  

Note: This strategy is favorable and advisable to be used when a sufficient amount of time is allowed and the number of requirement to estimate is considerable.

Estimation by order of complexity:

  • This is just the process of ordering the requirement based on their complexity.
  • Then, use the traditional model to estimate a representative sample of all the requirements.
  • Next the value of the traditional estimations from the requirements from the previous step would be extrapolated, also according to complexity order. For instance, we have 100 requirements and the estimation process is as the following steps:
  1. Complexity order assigned for all the requirements (e.g., Scalability: 1,2,3,5,7,12).
  2. Use traditional estimation to evaluate the representative requirements (e.g., 11).
  3. The complexity of the overall project is the average of the subset requirements (e.g., 3 representatives have the complexity of 2, these 3 estimations are averaged).
  4. The estimation value of non-estimated requirements is also taken and assigned.

Note: This strategy of estimation is suitable for the projects with the large number of requirements.

Estimation based on analogy: This estimation strategy is an approach that allows company build estimation of current project based on the similar one or ones they have carry on before. This to some extent will save a great deal of time and resources but also requires the company to have the followings to ensure a similar outcome:

  • Hand-on and extensive experience.
  • A good and comprehensive record of the previous projects.
  • Knowledgebase to analyze and recognize similar projects.
  • The estimators must be trained to adapt the analogous estimations and manage the knowledge repository.
  • Adapt of the analogous estimations and management of knowledge repository

Estimation by team: This approach is partially similar to the classic one. The only difference is that the smaller components as system module, business, presentation, etc., will be delegated to separate teams. Each team will independently offer their estimation. And the final result will be consolidated by the combination of individual results of the teams.

Note: This strategy of estimation is use for the projects with average number of requirements.

7. Recognizing AND address possible assumptions:

It is not possible to list down all the possible assumptions during the estimation process. But it is advisable to address the more of them the better to avoid possibilities of uncertainties. This will enhance the common understanding of the parties involving in the process of estimation.

8. Revising estimations:

Two heads are better than one. Revision with other estimators during the software estimation project help foresee the possibility of the projects, the possible assumptions, and the best estimation strategy. The only downside of this could be that the time constraint. More people, more ideas. You are, then, have to be strong enough to selectively choose which advice and change to carry on.

9. Employing estimation tools:

Software project estimation companies now could make use of tools to facilitate their estimating. With the assistance of tools, their work would be more systematic, and automatic. The process of estimation would cost less time and make it much easier to make reports and store data for future projects.

10. Noting for special projects:

The projects with a number of special requirements require of course more specialized hands to be accomplished appropriately. Then, the common tasks – software testing, analysis, infrastructure, development-which are usually taken care by estimation team have to be exclusively cared for by the high-profiled testers, designers, analysts.


Software project estimation is not a big task. It is advisable to gather a team of estimators experienced in various industries and kinds of projects. The team could work collaboratively to obtain clear understandings of the scale, objectives, and commitments and to utilize the recommendations to reduce uncertainties to get the most accurate estimation.