How to Properly Estimate Your Design Projects

A project estimate is an evaluation of how much time and money will be required to execute a project. However, every product designer understands how challenging it is to estimate the time required for a design process. Given the unique nature of a project, the more the complexity, the harder it is to obtain an accurate estimation. 

Learning how to properly estimate design projects requires learning all the estimation methods and mastering those most suitable for your business.

Failure to learn how to estimate effectively might lead you and your team to exceed your project budget, timeframe and cause delays, frustrating you, your team and especially your client.

However, there are several methods that can substantially enhance the efficiency and accuracy of your project estimation. In this article, we’ll discuss the most common and effective methods of estimating projects and some estimation pitfalls to watch out for when doing so.

Understand the estimation goals – Three project estimation approaches

The approach you use to estimate design is determined by the goal you want to achieve. For example, one of the first things to think of if you’re trying to build something like a web or mobile app is, “How much will it cost to build the app”? The structure and complexity of the app is a major factor here. In order to gauge the operating cost, we give you three approaches of estimates with a range of accuracy.

1. Ballpark estimation

A ballpark estimate provides you with a rough idea of expenses by giving your project a possible range of costs. The goal of such an estimate is to determine whether or not you could possibly develop the product and what you could accomplish with it.

In this case, the figure you obtain is an approximate amount based on the facts provided, not particularly precise but to give you an idea of the prospective expenses.

2. Budget estimation

The budget estimation is most commonly based on comparable estimations, which involves transferring budget results gained from a previous project to the present one.

You can do this by proceeding through the project specifics, comparing each element with the time taken in past projects to get a rough estimation. Although this estimation method is not the most precise, it gives you a rough overview of the resources needed without having to spend time doing a definitive estimation.

3. Definitive estimation

This is the most accurate form of estimation. It is often used for detailing all the figures and defining the exact scope of the functionality to be used for a product.

Before starting any project, you must ensure to have a thorough sitemap or user flow chart and a clear plan on how you want to tackle the project. Once the project has been broken down into smaller parts, it will be easy to predict how long it will take with high accuracy.

In order to collect all the data, you must talk with the clients about their budget and negotiate, then speak to the designers and developers about the project.

If you want a thorough estimate, you need both sides to be on the same page and one way to achieve this is to develop a complete product specification document, including wireframes mock-ups.

Project estimation methods

Regardless of which project estimation approach you’re taking, having the correct methods in doing so is equally important.

Overall, there are five main project estimation methods we use here at Morphosis: top-down estimation, bottom-up estimation, analogous estimation, parametric estimation and three-point estimation. 

1. Top-down estimation

A top-down approach allocates an overall duration to the project and then divides it into chunks. Each of these work chunks is intended to estimate if enough budget has been provided for the project. It is quick and useful to determine if the budget is feasible for the project and what activities can be performed within the given time and budget.

If a client tells you that the project must be completed within six months, a top-down method lets you use that timeline to estimate how much time you can devote to each activity inside the project while still finishing it on time.

2. Bottom-up estimation

The counterpart of the top-down is the bottom-up estimation. Using this estimation approach, you estimate each task or area of the project then add all of the individual estimates together to get the total project estimation.

Typically, it is a very accurate qualitative estimate, and since it is so detailed, you can easily evaluate project expenses to the estimate later on to ensure you’re on a budget.

You may also check estimated time frames to ensure everything is on track. A bottom-up estimate can assist you in managing your project while it is in progress and completing it on time and within budget.

3. Analogous estimation

Analogous estimates utilize previous project data in conjunction with a top-down project duration estimating technique.

This means that data from past projects are utilized to determine the amount or duration of a new project. In other words, comparisons are all you’ll do. The more parameters you have to compare, the more accurate the estimate.

The advantage of such an approach is that you’d have to do it for a short period – which does not demand a ton of calculation. Nevertheless, remember that every project is unique and it has to be specifically evaluated to obtain the real estimated resources required.

4. Parametric estimation

The parametric approach is a somewhat more accurate method than top-down or analogous estimates.

It is a project management assessment approach based on a new project, but it adapts to variables. It calculates the cost, duration and then defines the amount of units needed for the project by using the relation between the variables.

For example, to calculate the cost and duration, you’ll need to require data from similar previous projects. Then you compare resource usage between projects, which means each unit must be calculated (any task that can be measured is considered a unit).

Using this approach will save you a lot of time while providing a very accurate estimation of the cost, required resources, and time needed for your current project.

5. Three-point estimation

Three-point estimation moves away from ballpark estimating techniques and into establishing more accurate, realistic costs. This approach allows you to fit any demands of the client, at any time and within budget limits. 

This method involves taking an average of three scenarios: best-case scenario, worst-case scenario and most likely scenario.

When doing a three-point estimation, you need to estimate the resources required for each scenario and assess which scenario is most likely to occur. This allows you to account for unexpected problems that may occur throughout the project, reducing the risks for your team and company.

Four pitfalls of estimations for design projects

“The devil is in the details, meaning any minor details in plans and schemes that are frequently neglected can cause significant difficulties later.”

There are various factors that might undermine your estimates’ accuracy or validity. Some of which you can control and some you cannot control. The following list is not a complete way to solve all your estimating difficulties. Instead, it’s a checklist to keep in mind for planning and estimating.

1. Ignoring risk and uncertainty

No estimation is without risk, which is why overlooking or ignoring risk and uncertainty can result in inaccurate estimations during the project’s work process.

These could take in various forms and if not identified earlier on, there may be issues that will cost time. So to accomplish the desired result, you must be on the lookout for any possible risk and work on it.

Some of the risks may be due to a lack of stakeholder mapping. Uncertainty over who is responsible for what or who has access to information or resources might cause major delays.

For example, getting APIs on time is a regular challenge. Not knowing whether or not the API is being built and not accounting for this sort of risk might cause months of delays and financial loss resulting in a negative impact on your business.

Furthermore, it is important to have strong review and feedback processes in place to ensure that clients approve deliverables within a reasonable timeline.

2. Failure to involve task performers

Involving the task performers in the process will help in obtaining the most accurate estimate.

Failure to do so will not only be incorrect, but the task performer may also be reluctant to conform to an estimate of their labour over which they have no control over. However, if they are involved in the process, they will feel a greater obligation to reach or exceed the estimate.

3. Failure to identify tasks

One of the most common mistakes is failing to identify the tasks of the project required to complete it. This covers not just the project manager’s activities, but also the activities of the teams, such as progress reports, meetings, emails and phone calls.

Because larger projects are extremely difficult to plan in detail from the beginning, it’s required that you split down the activities into very minor tasks for a more accurate estimation.

4. Not helping clients define what they want

Most clients are aware of what they want, but they cannot always explain them in detail and translate it to project requirements.

It is the responsibility of the project manager to help the client identify what they want/need. The statement of requirements must be accompanied by the amount the client is ready to pay. 

Let’s work on your estimates!

Now that you know how to properly make an estimation for your projects, keep in mind that the method for selecting an estimate depends on project specifications, standard practices in your company, and the field in which the project is carried out. So analyze your existing capacity and present demands to choose the best method or merge them throughout project planning. 

Regardless of the project’s planning, the most essential thing is to work with a team with whom you share the same values and can fully count on the estimates and the project implementation, as everything goes according to plan and remains within the expected schedule and budget. 

As a fully equipped digital consultancy, we at Seven Peaks have a wide range of experts able to help accomplish your design and other development goals. To learn more on how we can take your business to the next level, contact us today for a free consultation and get your project estimated. 

Jeremie Tisseau   Jeremie Tisseau, CEO & founder of Morphosis and Chief Design Officer at Seven Peaks. He turned Seven Peaks into the most recognized UX agency in Bangkok.