Enjoy this video of my free online PMP Exam Preparation training course and prepare to sit and pass the PMP certification exam from PMI. This PMP training video covers the Schedule Management Knowledge Area in PMBOK6 and specifically the Estimate Activity Durations process.
all right so what we’ve covered is the initial the the beginnings of schedule management we’ve done plan schedule management we’ve defined activities we’ve sequenced them and you’ve been introduced to some terminologies which is really nice and then i’m going to introduce you to additional uh terminologies and these will be mainly the estimating techniques all right notice that i don’t you know i’m no longer looking at the input as much as i go through the training and the reason i’m not doing that is because most of these inputs already happened or will happen later on and at some point i will encounter these inputs for studying purposes i tend to avoid repetition and instead i focus on where the true source of information is going to come from and from what i see from pnp from training for so many years and even using it it’s really going to be in the tools and some of the key outputs that you see there things that repeat are not going to be important for me when i study but if i have time obviously i would look at it but then again you know everybody has a different learning style so here my focus is going to be to you know show you what the different estimating techniques are because we’ve already the way pmi is imagining things is that you don’t have the durations yet like on the schedule they imagine that you’re going to identify these activities um i’m just going to put days on that one you they imagine you’re going to identify the activities and that they will all actually be by default you know when when you first create the activity um i’m gonna add another activity here another activity um and usually by default you’re going to see that it’s one day uh so they want you to do this and then go and connect them so identify them sequence them and then after you sequence them because now it’s easy for you to view in one page if you haven’t created durations uh after you put them in the right sequence then you need to go and figure out how long every activity needs to be all right so first create the sequencing like the dependencies and then try to estimate how long the activities will take to complete and for that uh it could be a simple process of looking at the uh the amount of work that you have and then you divide it by the production rate right so the amount of work that we have let’s say this was for example we had to install uh 400 tiles right and let’s say the production rate for our team is that we are able to install 40 tiles per day this is how much we’re able to do then in that case it is going to take 10 days uh work quantity divided by times 400 tiles and i divided by 40 that we can complete by day then we can do all the work in 10 days so this is a simple way of estimating your activity duration the production rate that you see in the bottom here 40 times per day is really the factor that you can play with the 400 times that is above this is the amount of work it’s not really up to you but the 40 times per day that production rate that you see there that is something you could work on if you gave them more resources to the team or you gave them better tools or you give them better access uh even a ladder or whatever it is that they’re using um more enhanced equipment or software you will find that their production rate can go higher than 40 and if you can increase that production rate uh from what it says right now you know from 40 and you’re able to now complete it in 50 days instead i’m sorry 50 tiles per day um then that means that let’s see what happens when i do this so instead of 40 times per day they can do 50 000 per day then obviously you don’t need the whole 10 days to finish this instead what you will need is 400 divided by 50 you’ll need eight days to complete the work so if i’m able to impact the production ability of this team then i’m able to impact the duration of the activity so these are things these are very basic things that we do when we try to figure how much or how long something will take but you know when we try to do this some things don’t always go as expected so for example this law of diminishing returns the law of diminishing returns affects the production rate obviously if you increase the number of resources this is good for production rate if you change the technology that’s good for production rate if the team is motivated good for production rate but this law of diminishing returns that you see there that is not always going to work in your favor this is the same thing as you eating something that you like some your favorite chocolates i like dark chocolate with hazelnuts first bite tastes good second bite day so actually it tastes good for a very long time but i’m pretty sure there is a point where that chocolate doesn’t taste as interesting anymore and you start to feel disgusted with it because you ate too much of it and so it starts to have a negative feel so what the law of diminishing return says is that there is a point uh where the benefits start to reduce it’s the same thing with resources by the way on a project you add people to a project um initially the one person you added makes a huge difference so if you if you had a task that was 12 days and you give it to one person then it’s a 12-day job they will take 12 days if you give it if you add one more person two people then you would expect the job to finish in six days because two people are working on it add one more person now you have three people you’re expected to finish in four days add one more person one more person now you have four people working on it they buy 12 days by four people you expect it to finish in three days but you’ll be surprised that it actually doesn’t finish in three days maybe it still finishes in four days why well there’s a point where people start to you know fumble stumble into each other uh they stand in their own ways or they don’t have space to actually put things or equipment or maybe some things only happen in a certain sequence or maybe they take longer bathroom breaks and so on or they talk to each other and delay each other so that’s the law of diminishing returns there’s a point where performance starts to drop or the benefit starts to reduce and that’s when you need to stop adding resources there’s a couple of other things that we watch for which are stated here the student syndrome which is me um i wait for the last possible moment before the deadline to get something done and i do it quite a bit but you know what i happen to be really good in last moment stop that’s my strength other people will panic and just you know they will break apart at that point um so student syndrome is when you wait for the last minute watch for your team if they’re doing this and then parkinson’s parkinson’s law which has no relationship to parkinson’s disease um couldn’t they have come up with a different name anyways parkinson’s law uh if i give you uh five days for a task you’ll use all five days if i give you six days you’ll use all six days no matter how many days i give you get it done and you use that time you’ll expand your work to that time that’s why your managers only give you three days do you blame them they know you’ll finish it in three days so the less time they give you the more you’ll do not necessarily all the time but you know people do stretch their work because they have more time on their hands it’s what happened to me knowing that i’m stuck at home for a long time um before i was just dreaming of a day or two that i’m free to work on my book now i had all this time so i stretched it you know now and then i look at it but i never really took it seriously because combination of parkinson’s law and student syndrome i will use all the time and i’ll also wait to the last second to actually do that but then you know this sitting at home is time to have the effect of law of diminishing returns first is like hey i don’t have to do anything for a while excellent you know i’m a trainer if i can’t do training nothing to be done then at some point the benefits of not doing any training study to go down the law of diminishing returns um the estimating techniques that i want you to be very very very familiar with uh for the exam i’m not going to say this is for practical usage because for practical usage we don’t say oh let’s go do analogous estimating let’s do parametric estimating we don’t do that but for the sake of the exam you have to know that there are different ways that we estimate and the quickest of all is this um is the analogous estimating and analogous estimating which is also called top down estimating this is dependent on someone having some background in it so my background is training and consulting so if i go to a company um and i sit with their management i can quickly assess um how long you know my business process is going to take to develop a construction specialist can come and give you a quick estimate on some construction work and the reason you can do that is because you have a background in it you have experience it is a top-down view on the task and we say okay i think it’s going to take that long is it going to be accurate not necessarily top-down estimates are fast but not so accurate all right and then you have uh i’m i’m going to skip parametric for a second i want to do bottom-up all right because the opposite of top down is bottom up just the wording itself right top down quick estimate seen from the top like this you know i’m giving you a quick number based on experience bottom up i have to add up all the numbers at the fine details before i can come up with an estimate this is for someone who doesn’t know enough and isn’t willing to take a chance it is the most accurate i’m going to analyze piece by piece uh what the work constitutes of and then estimate time for each and then add it up aggregate it and then i’ll get a estimate all right this is coming from the bottom up and it’s the most accurate way of estimating so bottom up very accurate but guess what time consuming whereas top down quick and not so accurate if you are able to get an estimate for one unit or five units or ten or whatever you can multiply it by the number of times you need to do something so if we’re uh you know laying out 20 kilometers of highway uh and we know how long every kilometer is going to take we just need to multiply it by 20 and that’s you know that’s how we get our estimate you can even discount for economies of scale or something like that but this is called parametric estimate estimated so parametric if i know how long it’s going to take for one and i know i have to do it for 10 times then i can just multiply by 10. if i know how long it will take for five and i have to do it for ten i multiply by two because i’m doubling the five if i knew how long it will take to do ten kilometers but next time i’m only asked to do five kilometers then i just divide by half this is really what they mean by parametric you just scale it up or down as needed to fit the size of the project then there’s this one which is going to be lots of fun for you parametric estimating i’m sorry three point estimating three point estimating i want you guys to remember that it’s called three point estimating and it’s also called pert uh pert stands for program evaluation and review technique and it is used for risk uh to inc to infuse your risk and opportunity inside your estimate so what they do with bert is the following they figure that most estimates that we use are you know what we call the most likely estimates or the common estimates or the typical or usual or realistic we use different names for these things and then we have the worst case scenario which is the pessimistic and then we have the best case which is the optimistic actually what i should have done is i should use color codes most likely should be yellow and then optimistic would be green right this is the best you can get and the worst is the pessimistic and they use a combination of all three to come up with the estimate if you’re thinking in terms of an average estimate then you’re thinking of a triangular distribution where you take all three estimates all three estimates there add them up and divide by three however that’s most likely what they’re not gonna they’re not gonna ask you about that kind of an estimate instead they would ask you about the beta distribution not the triangular distribution in the beta distribution this t e is time estimate this is time optimistic time most likely time pessimistic or pessimistic time most likely time optimistic time and estimated time so if you’re using the beta distribution you don’t assume that all are equal you see if i figure that the optimistic and the pessimistic and the most likely are all equally likely to happen i would be wrong why we call this most likely for a reason because that’s most likely what the estimate is going to be so when you drive to work it took you a certain amount of time and only when things were really wrong you took longer or you know no bad drivers in front of you no accidents when you finish you got there faster right so there are times when things are in your favor there are times when things are really playing against you and so these are the optimistic and the pessimistic estimates and we all know it’s not always going to be this for that it’s going to be the most likely um most of the time you’ll hit that middle number there so what pmi is suggesting um is that we should give more weight to the most likely and exactly four times the weight and only one time the way to optimistic one time to pessimistic and all together you have six items uh why are they six well because this is going to count as four this is going to count as one and this is going to count as one because we’re gonna count this as four times as stated here let’s say a project activity takes uh you ask a team of people and you say how long will it take and they tell you that it takes 40 days okay but there are people who said that we’ve had luck sometimes and things have gone well and we had finished in 30 days but then some would say that we don’t always have luck and it’s not always normal and we have had problems we faced major issues and it has taken 100 days so then what do you do so which estimate would you use an average of all well if you use an average you’re just assuming that all are equally likely but you know what the hundred days on the right and the 30 days on the left they’re not going to happen all the time it’s the 40 days that happen so either take the 40 and say this is what usually happens or or you do the three-point estimate so to do the three-point estimate i will add them up but when i add them up i will multiply the middle number 40 by 6 sorry by 4 4 times and then i will get 30 plus 160 plus 100 and this amounts to 260 219 290 altogether and because i had four instances for the middle and one instance one instance uh there’s a total of six instances so i’m gonna divide the 290 by six and whatever the number is is almost is the answer so if this was 300 this would have been 50. but this is almost 49 i would say all right so that would be in my first estimate my three-point estimate this is how you do it so i want you guys to do this little bit of an exercise imagine i had um 40 i had um six hey what happened 60 and i had 120 what would be the three point estimate why don’t you go ahead and solve that [Music] so let’s say they tell you that your pert estimate or the three point estimate is 60 and your best case is 20 and your most or your typical estimate is 50. what is the worst case that you can imagine can you solve that well so i have to think about optimistic right plus four times the most likely plus pessimistic and then i’m going to divide by 6 and all of them all of these are going to equal the answer which i’ve given to you which is 60 all right and i’ve given you the optimistic which is 20 because i said best is 20 so it’s 20 plus four times the most likely which is the typical which i gave you as 50 4 4 times the typical which is 50 plus i did not give you the worst case which is the pessimistic so i’m going to leave it as p divided by 6 equals 60. now that we have that let me just push this up it’s just algebra from this point okay so bringing back the sad memories of algebra so then we have 20 plus 4 times 50 is 200 plus p equals and i’m going to move this 6 up there so that means 6 times 60 that would be 360 is just basic algebra right so that means p if i isolate it for corona if i isolate it equals 360 minus the other two here 220 that makes 140 so the worst case is 140. isn’t that a beautiful way to look at it so pmi on the exam could always leave out one of the variables and give you the others if they leave out two of the variables then there should be an answer that says cannot be solved based on given information so analogous is based on analogy that i can draw from previous experience called top down sometimes they even call it expert judgment so analogous top down expert judgment they’re pretty much almost the same parametric has its own name it’s based on scaling up or down three point is the calculations be careful if they asking you for beta or for triangular distribution triangular is just an average uh beta is the one that we did the calculation for and bottom up requires that you add the details and fine details and it’s more accurate longer it takes more time to produce but that’s probably the best estimate you can get obviously when you’re trying to estimate durations you can always consider if there’s different alternatives available to you in doing the work so if you have different resources or more capable people or better technology maybe you would have different outcomes also in the bottom here you need to consider reserve analysis and reserve analysis looks at risk involved if there’s going to be a risk involved then consider maybe additional time just to be on the safe side a lot of organizations will tack on additional 10 on estimates because they feel that most of the time it can be in that range and you know what uh when i did um when i built my property it’s not a small property actually it’s two units we had estimated when we added by different types of estimates either from experience which is analogous and sometimes we multiplied by square footage so that was parametric so if we knew like a square foot of uh you know floor would for hardwood will cost this much we did parametric to multiply it by the whole living space uh through to come up with an estimate but then when we came up to the end it was around five hundred thousand so what i did was i added ten percent as a contingency this is the reserve analysis state software i added ten percent so my estimate was five hundred and fifty thousand and guess what happened at the end when we finished the work guess how much i had spent exactly 550 000. it came in exactly at 50 000 the the risk the additional items uh so anyways uh reserve analysis that’s what i’m talking about i did add 10 and we ended up using it but that was my contingency in case something went wrong i did use decision making throughout when i was trying to estimate because we’re trying to figure out uh better ways or alternatives as in you know there was no voting i called the decisions here but it was a discussion me and like my key contractor on this um duration estimates are the outcome of this one process we’re still talking about estimating durations um don’t be fooled by what you see in the bottom here i don’t think in project management we’re ever going to produce this kind of an estimate a range of two weeks plus minus two days nobody really does that uh i think if you want just say 10 days enough or something like that we don’t really put ranges in the estimates we just put a number um but you will if you want you know the range really is dependent on pessimistic and optimistic but in reality when you put it on a schedule you just put one number so that’s what you’re going to get as an outcome you’re going to get the duration estimates which you would have produced using different techniques that we discussed about and whatever estimate you come up with you need to also make clear what was your basis for that estimate sometimes it was based on using new equipment based on highly qualified resources based on a certain time of the year that we’re doing this so that’s that for coming up with estimates
