The Importance of Over Estimating Time Spent on a Project

Let’s face it--projects rarely go exactly as planned. Projects usually involve a finite amount of uncertainty (risk) that may lead to problems and surprises during the course of the project. Dealing with “surprises” generally requires more time, energy, and money than originally planned.

So how do project managers compensate for this? Great question! The answer is that they overestimate the time needed to complete a project. Is this wrong? It’s wrong not to!

All savvy project managers overestimate time to protect their team and projects from unforeseeable deviations and delays. Perhaps two of the most critical considerations are the type of project you’re working on and whether or not you have completed this type of project before. Many companies do the same type of project over and over. They’re good at it and very efficient, so this precludes the need to overestimate time.

Estimating time becomes more critical when you’re involved with a project with more variables or unknowns. The trick here is to identify what those unknowns or risks are, and then estimate a range of time that those potential risks could take to resolve or complete. This process/ideology is what is known as “range of error.”

You have to at least acknowledge the fact that there are things you do not know, and try to estimate based on that. According to Ray White, Founder and Chief Executive Officer of Scoutwest, Inc., “What I used to do, when I was in the service and consulting business, was list dozens of tasks--lots and lots of tasks. Then I would put them in a nice summary task. The more tasks you can list, the less you have to pad. It is important to try to foresee everything you could possibly do on a project.”

It’s important for all project managers to push themselves to think beyond dates. Once you are able to do this, you will be amazed at how much longer the schedule seems. Often it’s much longer than you initially thought it would be, and the more tasks you list, the less you have to pad.

So, how do you relay these percentages of errors to the client? Or do you?
White explains, “You have to ‘fess up to the client and say that you don’t know how long this project will take, but here is my belief. And it’s not unethical to do that. You are being honest and admitting that you do not know all the answers.”

As long as the client is willing to accept this and understands that you will always be reevaluating task forecasts and time spent, they will realize that you and your teammates are not robots. The best advice is not to hide padding from your clients.
Estimates, by their very nature, are never exact. At the most, they are best guesses. But, according to a recent article posted on Microsoft Online, you can improve your accuracy by dividing the estimation task into three distinct steps: (a) determining a work breakdown structure, (b) estimating the amount of work and duration of work packages, and (c) calculating the project schedule. Experience and historical data will also improve your estimates. If you've done a task many times over — or have a lot of documentation for similar tasks — you'll know the task's average duration.

With all of this in mind, it’s tempting to over pad your estimate. Here’s a warning: Over padding increases budget costs, and if your budget is too high, your project might not get funded.

Ray White is the Founder and Chief Executive Officer of Scoutwest, Inc., the developers of Standard Time® and Standard Issue® Product Management Software. Ray's involvement in software development and project management began over 26 years ago at the Eastman Kodak Company, and since then, he has worked with approximately 30 executives, 90 project managers, 300 engineers, and 10,000 customers. By project managers, for project managers--his products help thousands of international customers plan and track time for their mission critical projects.