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Axioned Axioned Handbook

Estimation Process

Estimation Process

Purpose

The goal of this document is to provide guidelines to the Project Managers/SPOC to be able to follow appropriate steps while creating an estimate. Proper estimations will help us predict the quantity, cost, and price of the resources required to complete a job within the project scope.

Note: SPOC = Single Point of Contact (which may or may not be the Project Manager)

Ideal Timeline for an estimation

Ideally we should take somewhere between 3 to 4 days. These days are further bifurcated below,

  • Ballpark Estimation: 1/2 days
  • Estimation, Documentation (SOW/Project Brief) review/approval: 1 day
  • Costing/Budget review/approval: 1 day

Note: SPOCs can initiate a working session to make the estimates if there are too many uncertainties or a shorter turnaround or there is a need for extra support from Management Team Members (CEO/ Account Manager/ COO/ Tech Lead/ PMO lead etc).

Estimation Guidelines (steps)

Pre-work

  • Once the estimation request is received (from PMO/COO/CEO/Tech Lead/Account Manager/Client), review the details available and set expectations re when this can be picked and by when the estimate will be ready for client.
  • Depending on the expectation set for the estimation, now work backwards and set the target timelines for internal estimation review, cost review etc before sharing with the client.
  • Create a Project folder as per the folder structure and place all the requirement documents/client inputs along with the estimate sheet here.
  • Review the requirements sent by the client.
  • Get a development team member if feasible on requirement gathering check in call.
  • Check-in (if scheduled) clarify and keep questioning until you get all your answers or make assumptions to make progress and specify all the assumptions made. If not, clarify all the questions over email.
  • Make sure client and you are on the same page regarding the requirements
  • Document the requirements and scope (features and functionalities). This can be identified in the estimate/ballpark sheet for internal clarity.

Estimation & Documentation

  • Pass it to the team (Development, Design and QA) for quick review. Convey/Explain these requirements to the team on a call.
  • If any of the requirements has conflict/suggestion, get back to the client for further clarification or make assumptions and list them somewhere (Project Brief) so you can propose the estimate with your list of assumptions.
  • As default (unless there is a strong reason to do otherwise - which can be discussed), phase 1 and phase 2 timeline and costs would be calculated AND presented as one cost.
    • For resource allocation purpose create separate tabs for phase 1 and phase 2 and a separate “Phase 1 and Phase 2 Combined” tab for comparison.
    • The total timeline as of “Phase 1 and Phase 2 Combined” would be addition of the separate tabs for phase 1 and phase 2.
    • The total Resource allocation % in the “Phase 1 and Phase 2 Combined” tab would be distributed across the resource allocation for the separate tabs for Phase 1 and Phase 2 (for better cost presentation/proposal work).
    • The % utilization will vary to fractions in the combined tab which is OK. Make sure the efforts/hours total are the same/as close as possible or realistic.
  • Once we have an estimation in hours in place, check for the number of resources that can be assigned (check with dev and QA, design Lead) and derive the timeline associated with these estimates based on the number of resources that can be assigned.

Eg.

  • If we get an estimation of 60 hours from the team, check for resource availability with the Dev Lead(s).
  • Assume we get 1 full time Developers, 0.5 QA and 0.5 Design member which adds up to(15 hrs/day)
  • From above we can derive a timeline as 5-6 days accounting client feedback turnaround time etc.
  • Once clarified, ask for the associated level of efforts from each of the team members, preferably over a call/meet. (Work with your team to come up with estimates in the ballpark template).
  • Once we have Estimates in place go ahead and create SOW/Project briefs.
  • Set proper expectations internally with Approver to get the estimates verified.

Estimating Phased projects

  • Apply the phase 1 and 2 approach in estimations (even in ARs) as applicable:
    • Phase 1 = firm-up/document assumptions, requirement details, phase 2 plan/timeline and clarify estimate for Phase 2
    • Phase 2 = build/qa/release
  • Phase 1 and 2 approaches can be used when:
    • Team needs additional effort/time to review all client deliverables to finalize the dev approach.
    • Team needs to work on a Proof of Concepts before finalizing the dev approach.
    • Team needs additional effort/time to review the existing code base before proceeding with additional development to understand the reusability of existing code.
  • How to work on Phase 1 and 2 approach for estimations?
    • You/the team develop a fixed estimate for Phase 1
    • You/the team develop a range BALLPARK estimate for Phase 2 (low/medium/high)
    • Develop the phase 1 and 2 estimates based on: TIMELINE AND PERCEPTION OF EFFECTIVE RESOURCES NEEDED (for that entire timeline)
  • How to communicate to clients?
    • See below for sample communication draft:
For the [Project / AR], we'll be following a phased approach. See details below re: phase definitions and outputs from each phase.


Together, for Phase 1 & 2, the cost will be: Low: x, [Medium: x,] High: x.


We'll be clarifying our findings at the end of Phase 1.

Estimation Approval process

  • First review/approval by: Tech Lead/PMO
  • Second review/approval by: Account Manager (if applicable) or Anurag
  • ETA: 1 day

Costing

  • Post verification PM to send an email over to the Accounts team internally for them to share costs with the internal team for cost review before sharing with the client. This email should include,
    • Client & Project Name
    • Client SPOC name and details
    • Project Brief
    • Estimation Sheet
    • Zoho link
    • Unique Project ID
    • Budget hours
    • Additional notes (if any)
    • Email Template

Subject - Axioned/[ClientName]: Ballpark Estimate for [Project Name]

Hi Accounts Team,

Can you please share costing for an estimate with [Account Manager] over email today before [day/time]?

Pasting the project name with all the relevant details below,

Client: X

Title/Project Name: X

Client SPOC: Name <emailID>

Project Brief: X

Estimation sheet URL: X

Zoho project link: X

Unique Project ID: X

Budget Hours: X

Please let me know if you have any questions.

Thank you,

X

Approval

  • Cost review & approval to be made by PMO/COO/Account Manager/CEO

    • ETA: 1/2 days

  • Accounts / Account Manager to share the final approved budget with the client. The Account Manager can decide how to present the cost to the client, this could be in the form of email or a formal proposal (eg below).

  • Keep the client informed re when we/Axioned will share costing with them.. Refer the screenshot below (This is applicable in case of estimation requests of AR on existing project where Project Manager can set expectations):

  • PM/SPOC to take a follow-up with the client over email/call to make sure they have received costs (This is applicable in case of estimation requests of AR on existing project where Project Manager can set expectations).

  • Accounts team to confirm internally once the costs/estimate is approved by the client post which a PM/SPOC can change the status for the same in Zoho and start working on the project.