Top Down and Bottom Up Estimating

After the Estimate Costs process, it is important to understand the Tools and Techniques of estimation. Have you checked our playlist on all the Estimation Techniques. Let’s add two more to that list in the form of Top Down and Bottom Up estimating.

Top Down Estimating

Believe it or not, you have already read Top Down Estimating because the other name of Top Down Estimating is Analogous Estimating. Since we have already discussed this, lets not get into the definition instead lets think through why this technique is called “Top-Down”?

Because when you refer to a similar project already delivered in the past, you estimate the cost of the entire project at once. This estimate is then apportioned into individual tasks. For example, the previous e-commerce app cost $240,000 to build therefore this one should also cost somewhere around $240,000. This value will be apportioned among the tasks.

Bottom Up Estimating

Just think of this as the opposite of Top Down. You had the overall project value which was apportioned to tasks. Bottom up is where you would estimate individual tasks first. These individual estimates will then roll up into an overall project estimate.

On real life projects, you will most often see Bottom Up estimating in action.

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