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Software Development Estimation: A Quick Guide

by | Sep 20, 2022 | App Development

Software development estimation is a critical aspect of your project. Without it, you can’t create the budget. For example, you are working on a legacy application modernization project. You need to accurately forecast the required time and effort before starting the planning phase. It will help you to create an effective budget. Hence, you can secure the necessary funding for the project. In this post, you will get a quick guide to software development estimation. You will know its importance, techniques, and tools. Let’s dive in.

What is software development estimation?

Software development estimation is a critical aspect of your project. It refers to determining the amount of effort required to deliver a software. It allows you to accurately predict the amount of necessary funding, resources, and time.

Why is software development estimation important?

Software development estimation is very important. Without it, you cannot predict the amount of effort, money, and time required to complete the project. You need the estimation for creating the budget. Once the project owner approves it, you will get the allocated funding. Therefore, you can start developing the software.

However, keep in mind the estimate doesn’t provide the final software cost. Instead, it offers a range of potential expenditures. The goal of the software development estimation is to help you secure a budget. Hence, you can get started with the project. Overall, it is a prerequisite to the software development phase.

Why is making software development estimation so hard?

Software development can be very difficult. There are several reasons behind it. For example, let’s consider a scenario where you are working as a front-end developer. You have received wireframes for the design. It looks easy. But there are no descriptions for the animation. Also, you haven’t received any specifications for different screen sizes. Besides, the client has already seen similar websites. He thinks that it is easy to develop. But in reality, the project is quite challenging. The whole situation makes it very difficult to make the right software development estimation.

How can I accurately estimate cost and effort in a software development project?

Do I need to break down the project into smaller milestones?

Breaking down a large project can help you to make correct software development estimations. Simply divide the entire software development into smaller tasks. You will get a clearer view of the required effort, time, and cost.

For example, you are asked to estimate the time required for building the front page. You shouldn’t say, “It will require a day to complete it.” Instead, you should break the project down into smaller pieces, like “Create CTA Section – 2 Hours,” “Add Contact Us Form – 2 Hours,” etc.

Read: What Are Software Metrics?

Is it important to start asking questions?

Task descriptions do not always offer a complete overview of the project. They might contain missing information. That’s why you need to ask questions when required. It will help you and your clients to stay on the same page. Always try to avoid making assumptions. Because your understanding can be quite different from the client’s expectation.

For example, the client says that each web page needs to have a breadcrumb. You shouldn’t say, “Ok. It’s a nice feature. It will take 2 hours.” Instead, you should ask questions. Should I follow the menu? Is there a specific pattern for the breadcrumb? Are there any special pages that will not follow the pattern? These are some of the questions that you should ask.

Can leveraging experience help me with the estimation?

Have you worked on a similar project before? Try leveraging the experience. Analyze the number of hours estimated for the project. Also, make sure to check the number of actual numbers required for the project. It will help you to identify areas where time estimates went wrong. Thus, you can make the right software development estimations.

If you have experience using the right development tools, you will have a higher chance of accurately making the estimation. Because you already know the amount of time that can be saved with them. Low-code tools, like Visual LANSA, can save you a lot of time. It combines low-code and traditional coding approaches into a single IDE. Hence, you can quickly develop desktop and progressive web applications.

Read: We Made Evaluating Visual LANSA Easier Than Ever

Should I follow a sequence of tasks?

If you are working in an Agile environment, you must have used story points. Here, you don’t use the number of hours for estimations. Instead, you use point sequences for different tasks.

There are two most frequently used story point sequences. They are 1, 2, 4, 8, 16 and 1, 2, 5, 10, 20. You should stick with a specific sequence for all the tasks. It allows you to measure the required effort. As a result, you can accurately make an estimation.

Read: How Can A Software Engineering Team Measure Productivity?

Should I set a maximum number of hours per task?

It’s very important to set the highest limit for a single task. It will enable you to effectively distribute time for the entire project. As a result, you can make the right software development estimation.

If you have a large task, make sure to break it down into smaller pieces. Then set a maximum number of hours for each of them. It will help you to accurately estimate the development time.

What are the different methodologies for software development estimation?

  • Bottom-Up Estimation: Bottom-up estimation technique divides a project into tasks and subtasks. Hence, you can easily come up with the right estimates. Also, the tasks and subtasks are easy to define and manage. As a result, you can efficiently handle your software development project.
  • Three-Point Estimation: Three-point estimation technique involves providing three ranges of estimates from three data points. They are “best scenario”, “worst scenario”, and the “most likely scenario”. It provides the final estimate by calculating their weighted average.
  • Parametric Estimation: Parametric estimation involves a statistical or mathematical approach. There are several steps. The first step is pinpointing the requirements, complexity, and technology of the project. The next step is to analyze similar projects and determine the amount of work required for software development. Finally, you have to determine the cost by analyzing empirical relationships between the total tasks and the factors involved in the project. The technique allows you to utilize scalability to ensure high accuracy.
  • Relative Sizing: Relative sizing performs estimation by comparing or grouping different tasks together. It doesn’t estimate user stories separately or in absolute units of time. Relative sizing is proven to be more effective and accurate than other methods. That’s why Agile teams around the world love to use it.
  • Wideband Delphi: Wideband Delphi is a consensus-based software development estimation technique. It allows you to estimate the time required for completing a task. It involves experts answering questionnaires in multiple rounds and a facilitator summarizing the findings. The technique offers several advantages, like easy implementation, low cost, high accuracy, etc.

What are the different software development estimation tools?

Work Breakdown Structure

The work breakdown structure (WBS) is a tool that decomposes a project into smaller components. It provides the necessary framework for detailed cost estimation and control. Also, it provides a guide for schedule development and control.

There are two representations to work breakdown structures: Outline View and Tree Structure. The Outline View gives a representation of the entire project. It uses numbers to record the various stages of software development. The Tree Structure also shows the entire project. It displays the final deliverable on top. Also, it shows a row of all project stages underneath.

Read: 5 Powerful Productivity Tools For IBM i Software Developers

PERT Chart

PERT Chart is a project management tool. It enables you to effectively schedule, organize, and coordinate tasks within a project.

PERT Chart utilizes a three-point activity estimating technique – M, O, and P. M refers to the most likely time and money required for the project. O stands for optimistic situation. It refers to the best-case scenario for completing the project. Finally, P stands for the pessimistic situation. It refers to the worst-case scenario.

Product Backlog

The product backlog is a prioritized list of tasks. They need to be done to complete the project. It’s one of the most useful tools for software development estimation.

Here, you use story points to estimate the product backlog. It allows you to get an idea of the effort required to complete the project. The most important tasks are shown at the top of the product backlog. Therefore, the development team knows what to deliver first.


How do you estimate a software development project?

You can estimate a software development project by breaking it down into smaller tasks. Then you have to choose an estimation sequence. Also, you need to set a maximum time limit for each of the tasks.

What are the software estimation techniques?

The software estimation techniques are the methods for forecasting the required time and effort. There are different techniques. The most notable ones are Bottom-Up Estimation, Three-Point Estimation, Parametric Estimation, Relative Sizing, and Wideband Delphi.

How do you estimate development effort?

You estimate development effort by utilizing the product backlog. It is a list of project deliverable items. It enables you to estimate the required effort for completing each of them. As a result, you can conveniently forecast the total development effort.

What is a software engineering estimate?

Software engineering estimate refers to determining the amount of time and effort for delivering or maintaining a development project.

What is a PERT estimate?

PERT stands for Program Evaluation and Review Technique. It is a software development estimation method. You use it to estimate project duration by determining the weighted average of optimistic, pessimistic, and most likely activity durations.

How do you estimate a project cost?

You can estimate a project cost by utilizing different estimation methods, like Empirical Estimation Technique, Heuristic Technique, and Analytical Estimation Technique.

Can Visual LANSA help me to boost my software development workflow?

Visual LANSA is a hybrid low-code development platform. It effectively combines low-code and traditional coding approaches. As a result, you can easily develop desktop and progressive web apps. Also, Visual LANSA enables rapid building, deployment, and operation of applications. Hence, it can significantly boost your development workflow. If you want to enhance your productivity, you should definitely start building applications with Visual LANSA. it can make your life a lot easier.

Visual LANSA is a low-code platform. It simplifies the way you of developing applications. Try it now for free. Or contact us directly.