How to Estimate Project Costs: A Method for Cost Estimation

[@rnishtala]

That is probably the best Estimation Explanation I have seen. Simple, effective and almost perfect explanation. Thank you so much for this video.

[@Onlinepmcourses]

Thank you very much.

[@oluwaseyitobi8093]

The is the first video class I'd enjoy in this journey

[@Onlinepmcourses]

Thank you.

[@ericrosicky473]

Came here for estimating left falling asleep. Such a soothing voice😂

[@Onlinepmcourses]

Sleep is healthy.

[@jasonwil5600]

I have ASMR, great videos and information. However as you have a great soothing voice, its hard to stay awake lol. Subscribed as I love your info and videos. Keep up the good work

[@gpalosanto4103]

I love interpreting info with the soothing voice!

[@MsAllie-hf1bh]

Me too. I'm sleepy

[@kashifnadeem5703]

Estimating sleeping project 😂😂

[@Patrick_Muwonge]

I always enjoy your presentations, so precise and yet very informative.. you make things easy and I like them(you) for that. From Uganda, East Africa.

[@Onlinepmcourses]

That's great to hear, Patrick. Thank you

[@ezinventor3274]

From Uganda as well am new here happy see u here just trying to understand project cost estimating

[@KM-un8ir]

as usual, very precise, informative and clear as crystal. Thanks for sharing your knowledge and broad experience.

[@Onlinepmcourses]

My pleasure!

[@preciousdillonagoma6575]

Knowing the people and material to do the work is the easy part. It's understanding the work in detail and effort required that is the hardest bit.

[@Onlinepmcourses]

A very good point.

[@EfosaOdiase-tn7wx]

You are amazing with how you explain concepts

[@Onlinepmcourses]

Thank you!

[@donharrold1375]

The fundamental starting point is not the WBS. It’s the project functional requirements (Statement of Requirements and the Design Basis), the Design (the key plans and specifications that define what needs to be delivered) and execution plan (the document that describes the methods, schedule and resources that will be used to deliver the project) that drive cost. The WBS and CBS are simply a way to coherently breakdown the work into manageable elements.

[@Onlinepmcourses]

The fundamental starting point of what? I agree that requirements are an important starting point for a project. But, for cost estimation, I have chosen to start with a knowledge of the what. This video is about one step in the project process, so I start where I choose. That is not to say that this is the beginning of the whole process.

[@donharrold1375]

@@Onlinepmcourses Fair enough. Good debating with you on a subject that often leads to heated opinions. I never fail to be surprised by customers who struggle with the basic concepts involved in creating robust estimates and execution plans. Your description of the “knife edge” and competing pressures between project promoters (sponsors) and project deliverers (PMs) is one I recognise well.

[@Onlinepmcourses]

@@donharrold1375 Thanks, Don.

[@guiller2371]

I took several estimating courses to estimate paper, hourly rates, skills, timing, etc. However; how can you find up-to-date data for your project? Also, the waste ratings; how do you deal with it?

[@Onlinepmcourses]

Finding data for making parametric estimates relies on having access to information about comparable projects. This requires one or more of: - hard experience in the project team - a data store in the organization - a great network of other PMs and experts (who are not bound by confidentiality) I do not understand what you mean by 'waste ratings'. If you can explain, I will tr to give you my answer.

[@eroosasenaga1228]

Quite an amazing concise explanation of estimation....

[@Onlinepmcourses]

Thank you very much.

[@dulcehernandez7483]

Thank you a lot for this video I found it easy to understand but very concise and complete explanation.

[@Onlinepmcourses]

You're very welcome. Thank you.

[@_iamoracle]

Your voice is sooooo sweet. 😊 I struggled not to fall asleep 😂😂😂

[@Onlinepmcourses]

There there. Just close your eyes………… 🥱😴

[@WorDouglas8]

Another great topic well explained - well done!

[@Onlinepmcourses]

Thanks!

[@mohammadsaleh1152]

Amazing content in a short amount of time 👏 (couldn't find this info anywhere on KZbin)

[@Onlinepmcourses]

Happy to help!

[@rhondakayesloss7763]

Thank you! Thank you! Thank You..🌸 Your teaching is clear and easy to understand. So glad I came across your channel.

[@Onlinepmcourses]

You are so welcome!

[@vaibhavmehta9966]

This was a great video. Thank you!

[@Onlinepmcourses]

You're very welcome!

[@aditisplayworld5853]

Great explanation sir.. Thank you

[@Onlinepmcourses]

My pleasure.

[@nadiyashah7367]

Good afternoon! I am stuck in one problem that my prof.assigned me as an internal assessment and it goes like this : Take an imaginary company . Work out its project cost, means of financing, estimate working capital requirements for 3 years, profitability estimates, cash flow and balance sheet for 10 years. Work out its payback period and NPV using 10 years as life of project. It is possible to get some tips in how to do it .

[@Onlinepmcourses]

Nadiya, I hope you will understand that I cannot help people with educational assignments. Quite aside from the time commitment, I don't think it is ethical. What I would note is that you have plenty of missing information here, but the essence seems to be to test your ability to build a Discounted Cash Flow (DCF). We have a video: kzbin.info/www/bejne/hqPCY5mPrNGXo9k You will also find formulas in the Investment Appraisal section of this article: onlinepmcourses.com/pm-formulas-understanding-the-math-of-project-management/

[@nadiyashah7367]

@@Onlinepmcourses Thank you so much !

[@felipemayer8773]

New subscriber from Brazil. Thanks for the knowledge.

[@Onlinepmcourses]

You're very welcome. Glad to have you on board, Felipe.

[@tommasinainnovationandlife7536]

Great video. Learnt a lot. Well explained.

[@Onlinepmcourses]

Thank you.

[@nyarkotina4075]

Thanks for the explanation... please what are the mechanisms that project managers can use to improve on project cost estimation

[@Onlinepmcourses]

Take a look at my full length article on estimating: Project Estimation: Master the Art and Craft onlinepmcourses.com/project-estimation-master/

[@nickjerrat]

Love the red team idea

[@Onlinepmcourses]

Thank you, Nicholas.

[@CanadianTobs]

I really enjoy how you teach. Thank you.

[@Onlinepmcourses]

You're very welcome, it's great to hear.

[@naomigarusinghe5145]

Thank you

[@Onlinepmcourses]

You're welcome!

[@joshuajerryhanson8929]

Good afternoon! I am stuck in one problem that my prof.assigned me as an internal assessment and it goes like this : Explain the concepts of cost estimation as applied in the mining industry and give reasons why you may prefer a particular approach used for determining these costs.

[@Onlinepmcourses]

Unfortunately, I don't know the mining industry. And anyway, you should research your own assignment, or you won't learn. I recommend you hit the library and find out the options. Then do some careful thinking. Good luck.

[@VariedPerspectives722]

You sir just got a new subscriber!!!

[@Onlinepmcourses]

Welcome aboard!

[@JalanJalanAjah]

I love this!!! Thank you so much❤

[@Onlinepmcourses]

You're so welcome!

[@aissabendjedda1974]

Good evening Please, I really need the diagram that appeared in your presentation, where we see the chain from the problem/opportunity to the risk register. I purchased your kit templates and the checklist documents but no one contains this diagram

[@Onlinepmcourses]

I made the diagram to illustrate my video, Project Planning 101 - How to Build Effective Project Plans kzbin.info/www/bejne/b3jCfap9bdStptE There is a download link for the diagram, in the description below that video: kzbin.info/www/bejne/b3jCfap9bdStptE Thank you for purchasing my templates and checklist. Others can learn more about them at: - PM Templates: onlinepmcourses.com/project-management-tools/project-management-template-kit/ - PM Checklists: onlinepmcourses.com/project-management-tools/project-management-checklists/ - Productivity Bundle (with both): onlinepmcourses.com/project-management-tools/project-management-productivity-bundle/

[@oummohammed9871]

Really appreciate your videos. Thank you

[@Onlinepmcourses]

My pleasure!

[@shakeelanjum604]

Great

[@Onlinepmcourses]

Thanks.

[@daveneedham4443]

A construction design estimator not only calculates design costs, he/she looks into those design details, to head off design problems before the problems get to the construction phase.

[@Onlinepmcourses]

That makes a lot of sense. My background is not in construction, but that rings true to me. Thank you.

[@JalanJalanAjah]

Make sense because the construction phase has a big uncertainty factor!

[@karlreimers]

Great job!

[@Onlinepmcourses]

Thanks!

[@ahmdealer]

Good presentation...Thx

[@Onlinepmcourses]

Glad it was helpful!

[@wawangarigithaiga7015]

Good explanation. Thanks a lot

[@Onlinepmcourses]

You're very welcome.

[@ranudevi5045]

Thank you🌹

[@Onlinepmcourses]

You’re welcome 😊

[@hnmuftiful]

How can i subscribe on your courses ? i looked online but i didnt find any sources

[@Onlinepmcourses]

No problem: my courses are at onlinepmcourses.com

[@DefectivePotato95]

Do you know of any good project cost history programs/softwhere that works like modelogix but is not modelogix?

[@Onlinepmcourses]

Paige - sorry, no. I don't keep up with project software, I'm afraid.

[@alisehgal1111]

Good video, I think you have done it quite well, thanks.

[@Onlinepmcourses]

I appreciate that, thanks!

[@mashoogh]

great content

[@Onlinepmcourses]

Thank you

[@aartijha7971]

Please let me know how to calculate the projected revenue for the Quarter Ptk

[@Onlinepmcourses]

I'm not sure I understand your question. What's Quarter Ptk?

[@kimberlyellis6614]

good video

[@Onlinepmcourses]

Thank you.

[@marishakrishna]

Can we implement your technique in machine learning with linear regression for estimating the project cost. Please suggest

[@Onlinepmcourses]

Frankly, I have no idea. I know nothing about machine learning. Linear regression suggests to me a series of data. Not sure what data set you are referring to. So, I am unable to help you, I'm afraid.

[@magedam]

Hi, I need to use Monte Carlo to justify my project cost estimation, is it possible to get some tips on how to do it?

[@Onlinepmcourses]

I'd like to help, but I am not sufficiently expert on Monte Carlo methods to offer you practical advice. However, for anyone wondering 'What is the Monte Carlo Method?' check out my video that gives the answer: kzbin.info/www/bejne/hn6shJxoj96oiJo

[@magedam]

@@Onlinepmcourses Thanks

[@sumeghathakur4457]

My prof said elements of cost estimate are:base, allowance and contingency. Can you please explain these.

[@Onlinepmcourses]

Maybe you should ask your Prof to explain. I am not sure what he/she means by this but I would assume: Base: the core predictable costs Allowances: amount to cover known unknowns - eg you don't know the weather so you allow for the worst-case Contingency: amount added to cover unknown unknowns - things you cannot anticipate

[@sumeghathakur4457]

Thank you. She provides links of your videos for understanding the concept so there's no point asking her.

[@SteveHovland]

Do you know how construction companies do this?

[@Onlinepmcourses]

I've never worked in a construction environment, Steve. But I do know that the starting points will be: - The technical drawings - how things need to go together - Quantity Surveyor's bills of quantities - how much of each thing is needed I also suspect that is often the civil engineers who will lead on the early stages of planning. Maybe hit up Michael Fisher at Leadership in Construction. He will know better than I do. kzbin.info/www/bejne/nIuveYCOh8aDfsk

[@tangobayus]

@@Onlinepmcourses I grew up in construction. My dad built houses. I would watch him go over a set of plans counting all the things he would need- from yards of concrete to light switches. In many construction projects, the contractors have to pay for the overruns. I have seen them go broke paying penalties. What if software people had to do that?

[@Onlinepmcourses]

@@tangobayus As I say, I don't know this industry. But a lot of the risk management will be through selecting the right kind of contract and procurement model. This article is written from the perspective of the PM procuring services. But the ideas may be helpful. onlinepmcourses.com/project-procurement-management/

[@tangobayus]

@@Onlinepmcourses The key point is that successful contractors keep detailed records of estimated and actual costs and use those to estimate new projects.

[@Onlinepmcourses]

Absolutely. I completely agree.

[@chetanasin9150]

Thanks

[@Onlinepmcourses]

Welcome

[@delesewilson429]

THANK YOUUUUUUUUUUUU!!!!!!!!!!

[@Onlinepmcourses]

Welcomeeeeeeee!!!!!!!!!!

[@hongluong7836]

Hay quá

[@Onlinepmcourses]

Thank you - Cảm ơn

[@O0oPORo0O]

any MGN384 :D

[@Onlinepmcourses]

???

[@merdekaataumati4851]

Not that easy to execute all sir lol

[@Onlinepmcourses]

Agreed - estimation is a hard discipline to learn, and fraught with difficulties and biases. professional estimators are very skilled.

[@sajjadhossen1702]

I am unable to understand your presentation at all.

[@Onlinepmcourses]

I'm sorry to hear it, Sajjad. Is it my speaking style, my choice of words, how I explain things, the structure, or is the concept unclear to you?

[@carlosrenatodamotabezerra106]

Great job!

[@Onlinepmcourses]

Thank you

[@thidungnguyen3220]

Hay quá

[@Onlinepmcourses]

Thank you. [Google tells me you said 'so cool' in Vietnamese]