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Estimating Solutions for Improved Project Delivery

This Solution stage aims to identify the best ways to solve the estimating problem and make informed decisions on available options to improve project delivery. It addresses issues such as inconsistent methodologies, lack of agreed time frames, poor historical data tracking, unclear process, and ineffective customer engagement.

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Estimating Solutions for Improved Project Delivery

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  1. Step 4: Identify solutions to resolve the problem Options Solutions Step 4 At the Solutions stage, we ask ourselves the following questions: “Which is the best way to solve our problem?” “How do we decide on the options?” Causes Implement Problem Results

  2. Contents • Rationale for change • Purpose of Estimating Service • Estimating problem statement • Terms of reference for Estimating Service • Estimating Submission and Response Process • Estimating Measurement Framework

  3. Rationale for Change Estimating has been the focus of a recent Creative Problem Solving (CPSn) improvement initiative (see next slide for the defined Problem Statement and Required State). The analysis undertaken as part of the CPSn revealed the following headlines: • No formal estimating methodologies are being consistently applied. • Time frames for providing estimates are not agreed formally. • Historical data tracking was not applied – each estimate is “new”. • The input and outputs for an estimate are not understood e.g. expected tolerances, by the teams in IS or the wider organisation. Therefore, expectations could not be managed effectively. • Decisions are being taken on investments without any credible assurance being applied – potential for wasted opportunities and priorities being set against poor data. • The process for gaining an estimate is not clear or understood. • There is very little customer engagement in the process, Estimating feels like a “black box”.

  4. Purpose of Estimating Service • To provide a consistent, experience and data led Estimating Service that can be consumed by Corporate IS teams at any stage of the delivery lifecycle. • Provide improved assurance at corporate planning and mandate stages to provide a basis for business priority decisions. • Early SME input highlighting assumptions and potential risks to be managed and considered. • Increases the quality of engagement and confidence in the service provided by IS. • Provides clarity as to what tolerances have been applied and why via the Estimating Model. • Assures the estimating thinking of project teams and suppliers. • Provides responses in a predictable time frame and sets expectations. • Provides less experienced staff an opportunity to develop. • Provides a set of empirical data to improve the predictability of time and cost for project delivery.

  5. Estimating Problem Statement Problem Statement • Over the last financial year, estimates compared to framework estimating tolerances have been as follows • There is no reliable timescale to obtain an estimate for walk-ins • Required State • The variances between estimates and outturn values will be within the agreed estimating framework tolerances. • Within 2 weeks of a walk-in being raised an estimate will be provided which meets target tolerances set out in estimating framework.

  6. Terms of Reference for Estimating Service

  7. Estimating Submission and Response Process Investment plan BC complete mandate/ estimation templates for each item BC complete mandate/ estimation template BC Sponsor Walk In PM submit approved mandate and complete estimation template R&D sanction needing ROM for total cost BC/PM provides back to sponsor 2 weeks Submit to estimation team at bi-weekly meeting - BC/Pm and sponsor attend meeting Estimation team Produce estimate – and provide back to BC/PM BC/PM attend Bi-weekly meeting to discuss questions/clarifications Estimation team log estimate for measurement and lessons learned BC/PM review and identify any questions Estimation team – ask any questions of clarification at meeting Output of meeting - finalised estimate – with tolerances clearly stated

  8. Estimating Measurement Framework Investment planning 4 3 1 2 Approved Mandate (Investment Summary) Budget Submission (or walk in initial estimate) R&D Sanction D&I Sanction Indicative(level 1 +200%/-50%) 1 Indicative(level 2 +50%/-20%) 2 Definitive (Level 4 +/-10%) Project Estimating Stage and Components Indicative(level 2 +50%/-20%) Actuals Definitive (Level 4 +/-10%) 3 Actuals 4 Definitive (Level 4 +/-10%)

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