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Understanding and applying analogous estimating techniques

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Updated on:
July 4, 2024
July 4, 2024
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Analogous estimating is this future-forward way we figure out the intricacies and details about new projects by looking at old ones we did before. It’s like using your older brother or sister’s homework to guess how long yours will take. We call this a top-down way because we start big and then get specific.

It’s like guessing how many candies are in a jar, but you’ve seen jars like it before. We can mix this method with others like range estimating or even three-point estimating to get even closer to guessing right. But hey, we gotta be careful, 'cause each project is kinda its own thing.

Introduction to analogous estimating

Analogous estimating is this neat trick in project managing where you use what happened before to figure out new project stuff. It’s like if you made a lemonade stand last summer and wanna do it again, you’d kinda guess the cost and stuff from last time.

We use some fancy terms here like ratio estimate or range estimate to make our guesses better. It’s not perfect, and it’s not as detailed as some other ways, but it’s super fast when you just need a ballpark idea and not every little detail.

Definition and basic concept of analogous estimating

Okay, so analogous estimating is like when you look at your old video games to figure out how tough a new one will be. We take a big look from the top, kinda zooming out, and use what we know to guess stuff about the whole new project.

We use this method to guess costs and how many people or things we’ll need. You can do it quick with a ratio or a range guess. Just remember, it’s quick but not always spot-on, like using a big scoop instead of measuring spoons.

Importance of analogous estimating in project management

Analogous estimating is super handy in project management. It’s like having a shortcut when you’re planning how much money or time something will need. Here’s why it rocks:

  • It’s a timesaver! You don’t have to dig into every little detail.
  • It’s flexible with three-point estimates—like guessing the best, worst, and most likely scenarios.
  • It helps figure out what stuff you’ll need without making it too complicated.

Boosting project efficiency with Bonsai tool

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How analogous estimating works


Analogous estimating is like when you look at how much prize money you got last time you went to Vegas to guess how much you’ll get this year. It’s a business-savvy way to figure out money and time for new projects by peeking at old ones. Sometimes, we use easy peasy lemon squeezy ratios or tricky three-point guessing games.

We think about the best and worst cases, kinda like wondering if it’ll rain or not. It’s quicker and cheaper than making guesses from scratch, but how right we are depends on how much the new project looks like the old ones and if our old info is any good.

Process of analogous estimating

Analogous estimating is about guessing project costs and stuff by looking at projects we did before. It’s a big-picture kind of guess, super quick and not too hard on the wallet.

First, we see how much the new project is like the old ones. Then, we use a ratio to tweak our guess. Last, we sharpen our guess into a range or a three-point shot for better aim. Sure, it’s not as on-the-dot as some other ways, but it’s easy and does the trick a lot of the time.

Key factors considered in analogous estimating

When we do analogous estimating, it’s like detective work. We dig up old project files to help guess costs because those files tell us what we might spend this time. We also think about how long things took before, so we don’t end up way off schedule.

And yeah, we gotta be careful with our ratio guessing—too happy or too gloomy, and our guess could be way off. We aim to hit just right, giving us a handy-dandy range to work with.

Advantages of analogous estimating

Analogous estimating uses old project stuff to figure out the new project’s money, time, and what you need. This means project managers don’t have to start from zero every time, which is super cool.

Also, it’s way faster to guess how long stuff will take with this method than with others, like bottom-up estimating, because we use what we learned before. And hey, it’s cheaper because it doesn’t eat up as much time or stuff, making it awesome for getting things rolling at the start of a project.

Time and cost efficiency

Project management is like a big puzzle, and one of the pieces is figuring out time and money stuff right. We use old projects to help guess costs better, which helps keep the budget in check.

There are a few ways to do this guessing game—top-down, bottom-up, and using stats with parametric estimation. Top-down gives us a big picture, bottom-up is all about the nitty-gritty, and parametric is like using math magic for super accurate guesses. All these ways help make sure we plan our time and money smartly.

Flexibility and adaptability

In project management, being able to change plans easily and adapt is super important for making sure things go smoothly. Top-down estimation helps a lot here because it uses what we know from before and smart guesses from experts to figure out how long things will take and how much they’ll cost.

We also have cool tools like parametric and three-point estimation to help adjust our plans when things change. These tools use both big and detailed guesses to make our estimates even better.

Usefulness in early project stages

In the beginning stages of managing a project, it’s really helpful to use estimation tricks like top-down, parametric, and bottom-up. They help us figure out how much money, time, and stuff we’ll need, which sets us up for success.

Using old project info helps us make smart guesses with ratio estimates, range estimates, or three-point guesses. These tricks make planning way more realistic and help us start off on the right foot with our projects.

Limitations of analogous estimating

Analogous estimating has its quirks. It leans heavily on the quality of historical data for cost and duration estimates. If the data’s sketchy, results can be off. It also assumes past projects predict future ones, which isn’t always true, especially in fast-changing industries. 

Plus, top-down estimating, often used here, skips detailed analysis, leading to underestimations and missed details.

Accuracy concerns

Accuracy is king in project management, especially for cost, resource, and duration estimates. It can make or break a project. Using techniques like parametric estimation, three-point estimation, and top-down estimation can boost accuracy.

But, if historical data is missing, ratio estimates vary, or bottom-up estimating has issues, accuracy takes a hit. Doing a range estimate can help spot variances and sharpen cost, resource, and duration estimates.

Dependency on expert judgment

Project estimation is a big deal in project management, using techniques like top-down, parametric, and bottom-up estimating. These often need expert judgment to nail down costs, duration, and resources.

Experts rely on historical data to make range and three-point estimates, crucial for project estimation. But this reliance can skew results based on their views and experience, affecting the whole project management process.

Comparing analogous estimating with other estimating techniques


Analogous estimating is a top-down method in project management. It uses historical data from similar projects to estimate costs, durations, and resources for new ones. It’s quick and simple, less time-consuming than bottom-up or parametric estimation.

However, its accuracy hinges on how similar the projects are and the quality of historical data. Compared to detailed techniques like bottom-up, analogous estimating might not always be spot-on.

Other methods like three-point estimation or ratio estimate might give a better range, especially for complex projects. These involve more detailed analysis and offer a fuller picture of possible scenarios.

Analogous estimating vs parametric estimating

Analogous and parametric estimating are both handy in project management. Analogous, or top-down estimating, uses historical data from similar past projects to estimate costs, duration, and resources. It’s quicker but might lack precision.

Parametric estimating uses statistical models and project-specific details to predict costs and durations. It’s usually more reliable, especially with strong data.

Often, these methods are used together; analogous for a quick estimate and parametric for a detailed, accurate range or three-point estimate.

Analogous estimating vs bottom-up estimating

Both analogous and bottom-up estimating are key in project management. Analogous uses historical data and expert judgment to estimate costs, resources, and duration. It’s a top-down method, quicker but less precise.

Bottom-up estimating focuses on individual tasks, estimating each activity’s cost before summing them up for the whole project. This involves:

  • Ratio estimate
  • Range estimate
  • Three-point estimation

Bottom-up often gives a more accurate and credible estimate compared to analogous techniques.

Real-world applications of analogous estimating

If you’re a fan of LEGO or a collector, analogous estimating is like when you use your past LEGO builds to guess how long it’ll take to snap together a new set. It’s super handy in project planning because it uses old projects to guess stuff about new ones, like how much money it'll take, how long it'll take, and what you need.

For instance, builders use it to guess the cost of new buildings by looking at ones they’ve already done. It’s also big in software stuff, where folks figure out how long it’ll take to make a new app based on old ones.

Even folks who make stuff or plan big events use it to guess costs and plan their time. Like, if you’ve thrown a birthday bash before, you kinda know how much the next one will cost and how long it’ll take to set everything up.

Use of analogous estimating in construction industry

In building stuff like houses or skyscrapers, guessing time and money right is super important. By looking at old building projects, constructors can make pretty good guesses about new ones.

They compare the new project to old ones to figure out how much stuff and time they’ll need. It’s not as perfect as some other guessing games, like bottom-up or using a lot of math, but it’s great for a quick first guess, especially when they're just starting out.

Application of analogous estimating in IT projects

In the world of IT, where folks make apps and software, analogous estimating is like a magic wand. It helps them guess how much it’ll cost and how long it’ll take by looking at apps they built before.

Sure, it might not be as spot-on as using super detailed methods or math models, but it’s quick and gives a good ballpark figure. Using old projects, they can make guesses about the best, likely, and worst cases for their new project's time and budget.

Tools and software for analogous estimating

Analogous estimating is a top-down method in project management. It uses past project data to guess costs and durations for new projects. This method leans on expert judgment and allows for ratio or range estimates.

There are several tools and software that help with analogous estimating:

  • Project management software: Includes features to estimate costs, activity durations, and resources.
  • Spreadsheet software: Great for detailed data analysis and three-point estimation.
  • Specialized software: Designed for parametric and bottom-up estimating.

Bonsai: A tool for analogous estimating in project management

Bonsai is a handy tool for time estimation in project management, crucial for project success. It offers both bottom-up and top-down methods. The bottom-up method breaks tasks into smaller parts for detailed time estimates, which add up to the total project time. The top-down method gives a broad timeline for the whole project, scheduling individual tasks within it.

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Bonsai’s time-tracking features help keep project timelines accurate. Users can record time with an in-app timer, log hours on timesheets, and monitor hours to optimize billable time. This detail is key for effective budgeting, preventing cost overruns and missed deadlines. Bonsai also helps set project budgets and predict durations, essential for resource allocation and avoiding financial loss.

Its reporting capabilities provide insights into project progress, time spent, and financials, aiding data-driven decisions.

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In short, Bonsai’s time estimation tools are vital for successful project completion. They offer a structured approach to managing tasks, ensuring projects are on time and within budget, boosting profitability and reputation. With Bonsai, project managers can handle time estimation with confidence and precision.

Microsoft project: A tool for analogous estimating

Microsoft Project is a practical tool for analogous estimating, a key project estimation technique. It uses historical data to estimate costs, duration, and resources. This is especially useful in top-down estimation, identifying overall project costs and duration.

It also supports three-point estimation, providing range and ratio estimates for each activity’s costs and resources. It simplifies parametric estimation, producing accurate data for bottom-up estimating. Overall, Microsoft Project is crucial for cost, duration, and resource estimation.

How Smartsheet facilitates analogous estimating

Smartsheet, a top project management tool, supports analogous estimating with features for duration, cost, and resource estimation. It uses top-down estimation, leveraging past project data to estimate costs, durations, and resources for new projects. Its data collection and comparison features simplify ratio estimates.

Smartsheet also offers range and three-point estimation options, enhancing forecast accuracy. Its project estimation techniques streamline management tasks, making it easier for teams to plan, track, and report on projects.

Best practices for effective analogous estimating

Analogous estimating is like using a treasure map from past adventures to plan your next quest. It’s a cool tool in project management that helps guess costs, how long stuff will take, and what you need by looking at what happened before.

Here are some tricks to make it work even better:

  • Make sure you’re using old project info that’s super on point and related.
  • Remember, not all projects are twins—so think about what’s different this time.
  • Use a three-point guess to cover all your bases, from best-case to oh-no scenarios.

Ensuring reliable and relevant historical data

Having the right old data is super important. It’s like having a secret recipe that helps you bake a perfect cake every time. Whether you’re guessing from the top down or building your guess from the bottom up, the old data tells you lots about how much stuff will cost and how long it will take.

So, you gotta make sure your old data is as right as rain. Projects depend on it for making smart guesses with ratio estimates, range estimates, and those handy three-point guesses.

Combining analogous estimating with other techniques

Mixing analogous estimating with other smarty-pants project tricks makes your guesses even sharper. It’s like having both a map and a compass when you’re treasure hunting.

You might start with a big picture guess from top-down estimating and then get nitty-gritty with bottom-up details. And hey, you can even toss in some three-point guessing for measuring different possibilities, or use parametric estimating to sprinkle some math magic on your estimates.

By using what you know from old projects and mixing it with these other tools, you get a super solid plan for your new project.

Conclusion: Maximizing the potential of analogous estimating

Analogous estimating is a solid approach in project management for nailing down costs, durations, and resources. By tapping into historical data, project managers can use techniques like ratio and three-point estimates to get a clearer picture of project parameters. Mixing this top-down method with detailed approaches like bottom-up or parametric estimation can boost estimation accuracy and set realistic goals.

In a nutshell, analogous estimation is a handy tool for project management. But to really make it shine, project managers should blend it with other methods to get a well-rounded view that captures all the project’s nuances.

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