6.3. Estimating the Project Resources (PMBOK, Section 6.3)
Resources include materials, equipment, and people. After the project manager and the project team have worked together to determine the sequence of the activities, they now have to determine which resources are needed for each activities, as well as how much of each resource. As you can guess, resource estimating goes hand-in-hand with cost estimating (which we'll discuss in Chapter 7). After all, if you need a metric ton of pea gravel, that's a resource estimate, but someone's got to pay for that metric ton of pea gravel.
In order to estimate the demand for the project resources, you'll need several inputs:
Enterprise environmental factors.
Organizational process assets.
Activity list.
The attributes of each activity.
The availability of the resources you'll need in the form of two calendars:
Resource calendars let you know when individual resources are available. This calendar tells you when Bob has scheduled a vacation, when a piece of equipment that your project needs is already scheduled for use, and even when facilities like meeting rooms are available.
Project calendars communicate when the project work may take place. For example, your project may allow work to happen between 6 a.m. and 6 p.m., Monday through Friday. Your project calendar will also identify any holidays when the project work won't happen.
Project management plan.
6.3.1. Using Expert Judgment
The project manager and the project team have worked together to create the WBS, the activity list, and the sequence of activities, so it makes sense that they'll continue to work together to create the resource estimates. And they do. According to the PMBOK, the project management team may work with experts to help make the best decisions. This is using the old standby, "expert judgment," when the project manager relies on someone smarter to help make the best decision.
6.3.2. Identifying Alternatives
As the project management team determines what resources are needed, there will be plenty of opportunities to determine which solution is the best solution for the project. Whenever more than one solution is presented, this is called alternative identification. Alternative identification comes in many different flavors:
Resources: employees or consultants, junior or senior engineers
Tools and equipment: power tools or handheld tools, newer versus older machinery
Types of materials: oak versus plywood
Make or buy decisions: build our own software or buy a solution from a vendor
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6.3.3. Relying on Published Estimating Data
If you are a project manager in construction, the cost of the labor you use, the materials you routinely work with, and seasonal factors you consider for each project typically vary, depending on what part of the country, or even the world, your project is operating within. Many companies provide estimating data on the resources your project can purchase based on the geographical locales the project takes place in, supply and demand, and the season of your purchases. Published estimating data helps the project management team determine an exact cost of the resources the project will utilize.
6.3.4. Using Bottom-Up Estimating
Every time I mention bottom-up estimating in one of my seminars, someone snickers and pantomimes drinking a shot of booze. Ha-ha.
Bottom-up estimating is the most accurate time and cost estimating approach a project manager can use. This estimating approach starts at "the bottom" of the project and considers every activity, its predecessor and successor activities, and the exact amount of resources needed to complete each activity. Bottom-up estimating accounts for all of the resources needed to complete all of the project work. While it is the most accurate estimating approach, it is also the most time-consuming.
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6.3.5. Examining the Activity Resource Estimates
So what do you get when the project manager, the project team, and all your experts complete the activity resource process? You get the requirements for all the project resources. Not a trick question! The process allows the project manager, the project team, management, and your key stakeholders to see the needed resources to complete each work package in the WBS. Specifically, at the end of this process you'll have:
Resource requirements for each activity You'll know what resources are needed, the assumption your project management team used to create the requirements, and the basis for each estimate.
Updates to the activity attributes You may have errors and omissions, change requests, and discoveries about and around the activities that you're estimating. If the activities or their attributes change, you'll have to update your original activity list to reflect these changes.
Resource breakdown structure This is a hierarchical breakdown of the project resources by category and resource type. For example, you could have a category of equipment, a category of human resources, and a category of materials. Within each category, you could identify the types of equipment your project will use, the types of human resources, and the types of materials.
Resource calendar updates You know that the resource calendar identifies when the resources are working or idle. Updates to the calendar are based on the creation of the activity resource requirements. If change requests enter the project, the resource availability and demand may shift, which could affect the resource calendar.
Change requests Resource estimating can cause change requests. All change requests must be documented and follow the integrated change control process (discussed in Chapter 4).