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Estimating Without Fear: How To Do Away With Padding and Still Come Out Looking Like a Hero

Estimate-Without-FearWhen your team puts together an estimate, does it command a sense of confidence, trust  and respect from those reviewing the estimate? Or, is it assumed that  your estimate typically  is padded and may be off-by-an-order-of-magnitude?


Do people believe, that even though some changes will occur due to dependencies out of your control, your estimate is still reasonable and something the organization can  manage to?

Or, do they say that it would be great to hit that date, but still  challenge your assumptions and believe you’re really going to miss it?

I am sure that most of us will answer that “it depends”. It depends on the size of the project, the complexity, the individual asked (Harry never trusts our estimates), and so on.

So let me ask you to think of this from a different perspective.

  • Does your immediate management, your boss, typically have confidence in your team’s estimate?
  • Do your business sponsors and senior executives typically have confidence in your team’s estimates?
  • And for the most telling question of all: Do all of the members of your team who participated in creating the estimate, typically have confidence in the estimate and the ability to manage to it?

I am always surprised at how inconsistent these questions are answered, especially the last question.

In this post, I want to discuss the estimating activity that does the most damage in terms of  building  credibility and confidence, as well as  our  ability to predictably meet expectations.

Padding Your Estimate!

Padding an estimate is as common place as speeding over the posted speed limit. Sure, there are a few folks who typically follow the posted speed limit, but most of us realize that when they posted the 55 mph limit, that really is “highway speak” for 65 mph.  We pad that speed limit too!  But NOT for the same reason.

From my experience, padding an estimate is done out of fear.

We pad an estimate for fear of the unknown.

“I have worked with Jerry often enough to know that there is a chance he will want to tweak the report layout.  Also, even though he says keep it simple, he’s going to change his mind and will want to add features like exporting to Excel and PDF. If I pad this estimate, I’ll have enough time to give him what he really wants and be a hero by coming in on schedule and on budget. Hmmmm should I pad it by 25%, 100% or more? Hmmm?”

We also pad an estimate for fear of the known.

“I am going to need some new tables from the DBA team. I’m also going to need the backend services team to add some features to two web services.  This should only take a day or two, but I know that the process and wait time will take at least a week or two.  I should pad my estimate to allow for that, so I am not blamed if they take longer to deliver their changes.  I don’t want to be blamed. “

Remove the Fear Factor With Contingency Estimating

Your  fear is real. In fact, the truth is that many times, the fears become reality and we need the extra time. This is where  Contingency Estimating comes in.

The one consistent theme that padding an estimate has is a base and a pad. I think it will take two days (the base estimate), but because they always change their minds, this will take a full week to deliver (the pad).

With Contingency Estimating, you actually want to “advertise” and “magnify” your pad!  This is counter-intuitive, but you want to describe your estimate in the following way:

We believe this will take two  days.  We also believe, from experience, that we will take time during the review and find changes and enhancements. This happens every time and since Joe will want these changes, we believe we should plan on additional three  days of contingency time to let Joe volleyball back and forth so we can deliver this. So my estimate is two days to get it initially done, and three  days to let Joe modify,  enhance and get this done/done/done.

Now management can understand that if they want to reduce your five day estimate, they need to work with Joe – not you – on how to eliminate the rework or agree that the extra  three  days is  needed estimate to “get this right”.  The key is Joe owns the contingency time! And you have been transparent about what is driving your estimate.

Just as important, Joe knows that we have planned to allow for three days of review and enhancements and that he needs to have some ownership in time-boxing his review in that time-frame and schedule.

Here is another example:

We believe building this functionality will take about  one week. We can manage our part to the one week. However, we have to wait on the ERP team to modify their web services to handle the changes.  This typically should take three  days, however, they are so backed up, they typically take up to two weeks to complete the work and remove any defects. So my estimate is one  week and three days to do the core work.  However, I am adding seven business days as contingency time for integration, testing and making sure the ERP team and us are talking the same language.

Again, management can now understand the cost of the team-to-team communication and integration.  It doesn’t necessarily mean there is an ERP team problem! In fact, the challenge may be with your team and their ability to pro-actively manage in an integrated and distributed environment.

The truth is, it’s irrelevant “why” this happens when you build the estimate. It’s important to share the contingency time and then to tackle how to optimize later. This will build more confidence than “Padding” your estimate.

In Summary…

I hope you find this a reasonable approach to clarifying  for your management and team members what drives  your estimates and what part of your estimate is contingency planning for the “real world” challenges you deal with day to day.

Taking it a step further, I also hope this approach allows everyone to come to the table and begin the process of identifying areas that the teams can start managing better and  improve the actual time it takes to complete work. This would be done by first identifying contingency estimates and then addressing potential waste in the organization.

If you have a different opinion, I’d love to hear it. Please leave a comment and let us know!

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Category: Defining Success, For Practitioners, Team Performance