• Predictive Analytics for Improved Cost Management  



Blog



Original Post Date: Tuesday, July 1, 2014 Whether you’re doing a software cost estimate to support a Bid and Proposal effort, a software valuation, should cost analysis, or to develop a detailed project plan, it is vitally important to understand the ‘size’ of the software you are estimating.  The problem with software size is that it tends to fall into the intangible realm of reality.  If you tell me you are building a widget that weighs 13 pounds, I can really start to get my head around the task at hand.  If I’m chatting about this with my European colleagues, ...
Original Post Date: Friday, June 20, 2014 Proposal estimates based on grassroots engineering judgment are necessary to achieve company buy-in, but often are not convincing or not in sync with the price-to-win.  This contention can be resolved through by comparing the grassroots estimate to an estimate developed using data driven parametric techniques.  Parametric estimates apply statistical relationships to project data to determine likely costs for a project.  Of course, for a parametric model to properly support this cross check of the grassroots estimate, the proper data must be fed into the model.  This most likely requires the estimator to reach ...
Original Post Date: Wednesday, April 2, 2014 Introduction Parametric estimates provide reliable, reproducible, and flexible views into cost and effort so it’s only natural to want to include this data in a bid and proposal workflow. With TruePlanning 2014 big steps have been taken to make such integration seamless and easily reproducible.  New tools in the TruePlanning suite of products, as well as, integrations with some of the major bid and proposal software applications are at the heart of this new feature set. You can learn more about TruePlanning 2014 and the PRICE cost estimation models at our website, but let's ...
Original Post Date: Thursday, March 20, 2014 Here’s a conundrum.  You are a software estimator responsible for helping the decision makers in your company determine what business to pursue and what business to steer clear of.  You know, that to win profitable business, your company first needs to decide which opportunities are golden and which should be avoided.  You also know, that at the point at which this decision needs to be made, there is very little information available to support a quality estimate.  Add to this the fact that software estimation is hard   at almost any stage.  What’s ...
Original Post Date: Thursday, March 20, 2014 One of the complications in generating Bids and Proposals for Modules and Microcircuits is determining the “Should Cost” for better cost realism. Most of the electronic modules and their components in the proposals are not actually manufactured by the Proposer, but rather by a subcontractor, thus becoming a Purchased item. It is difficult to determine the cost of making the Module, and determining a fair cost. Costs for the modules include Assembly and Test costs together with the component costs. Components such as ASIC’s (Application Specific Integrated Circuits), have both the cost of developing the devices and ...
Original Post Date: Friday, October 4, 2013 True Planning results have many options, including viewing Costs by Activity. While simple, this view can be quite powerful, especially when exported for re-organization manipulation. In a recent exercise, the WBS mapping of common objects, estimated by separate multiple scenarios, presented a non-trivial chore in Excel. “Transposition” features work fine for matrices, as do pivot tables. But how does one map object by activity grids into activity lists, similar to MIL-STD 881a, with singular “roll up” instances of all nonzero object costs? The secret is in how True Planning appends each activity output with the ...
Original Post Date: Friday, October 4, 2013 The late Norm Crosby’s “Quality is Free” taught us that an investment into quality is more than offset by prevention of defects based upon understanding of requirements. Only with the latter can lack of conformance (and subsequent costs) be captured and hence quantified towards quality. So how then is Parametrics relevant? Parametric estimating is more than cost modeling. Our craft represents an initial consulting function into the accuracy and completeness of program planning concepts. Our customers trust us to know when to ask and when to supplement. Yes, we are mathematical and financial modelers ...
Original Post Date: Friday, October 4, 2013 In his August 2010 blog-entry, Zac Jasnoff outlined typical client perspectives for the different types of analyses that True Planning can accommodate.  Working on a large project, we’ve experienced situations that, realistically, can happen where the initial intent... and model structuring… later has the boundaries of model appropriateness stretched.  An AoA, for example, is meant to measure deltas between baseline and its alternatives.  If common costs “wash” then they can be excluded… which becomes an issue when treated as a Rough Order Magnitude for customer budgeting. Likewise, if a ROM or ICE of ...
Original Post Date: Friday, October 4, 2013 I’m not a golfer. But we’ve all heard one say “that’s why I play” after hitting a shot and feeling like it all came together. What “it” is, in terms of mechanics and timing, I’m not really sure. In our own world of parametrics, it’s the feeling of adding value in that golden moment of facilitating decisions and forward momentum. We wear many hats: estimating, consulting, systems engineering...even cost accounting. Building an AoA, ICE or ROM is where rubber-meets-the-road in regards to configurations and assumptions. Not too long ago I was in a discussion with ...
Original Post Date: Friday, October 4, 2013 In Parametrics is Free, I acknowledged receiving (too late) “you should’ve known to ask that” over the years. Quality control after-the-fact is fine; but it’s better and cheaper to take a systematic approach to quality assurance as part of your estimating process. The sheer volume of what we model can often keep us so close to the details that we are unable to step back and put on our QA hat on for a sanity check. Enter Quality! On a very large project, our team has introduced a few regular cross-checks, notwithstanding typical ...