Why Does Your Software Project Estimation Fail? Tricks for Accurate Predictions

A study by the Standish Group shows most US IT projects exceed budget and time constraints by 71%. Despite being carefully planned in the initial phases, many projects still cannot avoid running out of budget and time during the deployment process. This can be attributed to a myriad of factors that may arise throughout the software development life cycle, which the business may not have foreseen.

While lack of project management and skilled resources are the main reasons for project failures, inaccurate software project estimation is indeed the leading cause leading to disruptions in the seamless development of a given product.

It’s good news that estimates are hard to be accurate. It is completely understandable that software projects deviate from the estimate. However, the degree of error makes all the difference. There are instances where estimations can be reasonably accurate or at least within an acceptable range. By using tips and software estimation tools, it is possible for businesses to achieve reasonable estimates for project success.

Why Do the Estimations for Your Software Development Projects Keep Going Wrong?

Project estimation is hard to be absolutely accurate. However, if almost all of your predictions of project planning are quite far off track, it is time to reestimate the whole process. Below are some typical causes contributing to a wrong software project estimation that you need to avoid.

Poorly Scoped Projects

In software engineering, project scope is a concept that defines a project’s boundaries, deliverables, and objectives. More than anyone else, the project manager is the person most clearly able to lay out such requirements. However, if this is not the case, poor scope can lead to misunderstandings or ambiguity. These wrong project assumptions can ultimately result in accurate estimates as they fail to account for potential risks, limitations, and uncertainties.

The situation in which the scope keeps expanding without proper management due to changing requirements can also significantly impact the estimated timeline and resource allocation.

Over-optimism or Excessive Pressure

It is impossible to predict what the future holds. Instead of facing the inherently imperfect reality that potential risks can arise at any time, many businesses simply rely on the best-case scenarios to conduct software project estimation. Besides a failure to consider challenges and uncertainties in the estimation process, over-optimism can also lead to underestimating the effort required for each task, creating an unnecessarily relaxed and carefree mentality for developers involved in the production process.

Furthermore, estimates may be impacted by external pressure to meet aggressive timelines, leading to accelerated estimates and subsequent project delays.

Incomplete or Unreliable Estimation Techniques

There is no one-size-fits-all approach for your software development project, as each product type has different natural characteristics for each development stage, product type, and feature. For example, the process of creating a user-friendly interface on a banking app will consume less UI/UX designers’ time than the same task for an e-commerce platform for startups, as it requires many interactive elements. Assuming that every task takes the same amount of time is the shortest path to inaccurate estimation.

Besides, the use of flawed or outdated estimation techniques is also the reason why your predictions about the project’s budget and time estimates are constantly erroneous. Since such techniques may not provide a comprehensive scope definition, they easily fail to capture the true complexities and dynamics of modern software projects.

Inadequate Communication and Collaboration

It is no longer a strange statement to say that communication is key. Effective communication is especially important in initial estimates - the preliminary calculations made at the beginning of a project by the team and stakeholders. When there is poor communication and collaboration, there may be misunderstandings regarding project requirements. Factors that should have been included in estimation plans were carelessly ignored, negatively affecting the achievement of the project’s overall goals.

How to Improve the Estimation Accuracy?

Obviously, the estimation accuracy can never be 100% guaranteed. However, with the right approaches, project planning and delivery can be significantly improved.

Take Advantage of Historical Data

Data related to similar projects in the past may leave you a valuable asset in contributing to estimation accuracy. As a reference point, businesses can easily analyze the time, effort, and resources allocated for a better estimate of future projects.

Typically, past projects have comprehensive analysis sections in which benchmarks for different types of software development tasks are specifically recorded for use in extracting valuable insights. By accessing historical data, businesses determine the average time required to develop specific features, fix bugs, or perform testing, set realistic expectations, and improve accuracy in estimating similar tasks. This is also an effective tip to learn from past mistakes, identify common pitfalls, and promptly provide solutions.

Utilize Estimating Techniques

Estimation techniques such as top-down estimation and expert judgment were born to serve the need to improve software project estimation. Despite the technique types, they all have been developed and refined over time based on historical data and industry best practices. Their effectiveness in increasing the accuracy of project estimation has been verified and proven by the investigations of many large and small businesses.

With the help of estimation techniques, businesses increase accuracy, manage risk better, strengthen decision-making processes, and enable continuous improvements. However, it is important to note that they only truly maximize their potential when used properly. Businesses should apply techniques in conjunction with other project management practices to ensure successful project outcomes.

Break Tasks into Reachable Milestones

The software development process is indeed a challenging journey that requires multiple steps. Because of its high complexity, software project estimation is also very difficult to achieve completely accurately. Instead of leaving the large tasks, which can be overwhelming and difficult to estimate accurately, it is recommended to break tasks into reachable milestones for convenience in managing development progress and making necessary adjustments along the way.

When tasks are divided into milestones, resources are allocated effectively, cyber security risks are detected early, and effective communication with stakeholders increases. Breaking tasks into milestones also specifically aligns well with Agile methodologies such as Scrum or Kanban, helping businesses improve the overall performance of software products.

Be Strict to Your Estimations

While the advice of industry experts is of great significance to the software project estimation process, not all suggestions from stakeholders are informative. You need to know how to select data and consider them based on many factors to apply to the success of the project since no one is born to be a master estimator.

For instance, as a developer with experience in building auction websites, you estimate a specific task will be completed within a month. However, under the influence of stakeholders, you shorten the time to complete the task to two weeks. This negatively affects the product quality and provides wrong estimation when the task is done in haste. So, use your time wisely and consider the feasibility of any advice before acting.

Use Expert Input

Advice from experts in the field is a great way to strengthen the software project estimation process. With specialized knowledge and experience in specific domains or technologies related to the project, experts can give businesses valuable insights and guidance on estimating efforts. Some examples of domain experts who can give businesses advice include industry professionals, consultants, researchers, outsourcing vendors, and people from trade associations.

In addition, large volumes of data coming from Internet sources such as case studies also contribute to consolidating knowledge about interesting implemented modules and project estimation for businesses. Accessing specialized forums and groups dedicated to sharing practical experiences in all aspects of the development process is also a way to receive valuable advice.

You never know how it is unless you start doing it. If you need help from an industry expert, consider Orient Software as your trusted partner. For nearly two decades of experience, we have made great efforts in making the success of many projects from all fields, such as health, finance, education, etc. Give us a call for more details of our services.