by Anthony DeMarco
| September 18, 2014
Underestimates cause overruns, costing more and delaying benefits. Overestimates become self-fulfilling prophecies, consuming resources that could better used elsewhere. So much for your perfect plan. If you knew then that the big troubled project in your portfolio would take twice as long and twice as much, would you have approved it? Would you have not been better off approving the two smaller, more certain projects that would deliver benefits faster?
Improving your estimating accuracy from +-70% to +-20% more than doubles the net benefits from your portfolio of projects. Improve your estimating accuracy and you will improve profitability.