Introduction
Estimation is difficult to get right because it is about predicting the future which hasn’t happened yet. So much can ride on getting the estimation right and often it can be difficult to get estimates from people because they worry about getting it wrong. If an estimate is wrong, then time and budget promised can be incorrect that then needs to be managed. If only we could get better at estimating, then it would be easier to manage expectations. The truth is that estimation is based on assumptions, guesses and hope.
Why Estimation Fails
According to industry studies, as many as 50–70% of projects fail to meet their original time, cost, or scope estimates. (Sources: Standish Group CHAOS Report; McKinsey & Company; PMI Pulse of the Profession).
Here are some of the things to spot that are a sure sign that the estimation will be incorrect:
No clear scope or vague requirements
If it isn’t clear what is in and out of scope or have a good understanding of the requirements you are setting yourself up for failure. You can only estimate on what you know about.
Over-optimism or not including everything that needs to be estimated
Sometimes I’ve seen team members being asked to quote which is a great start because if they are familiar with what they have done similar before it can be a great help getting the estimation more accurate. However, all related activities need to be included in the estimation. For example, if a developer is estimating a software development are they including not just the development, but unit testing it, supporting system and UAT testing and doing any re-work that comes out of it.
Right to left planning
Sometimes a deadline is given and then the estimates are worked backwards from the time available. This can cause inaccurate estimates if there are no checks on whether this is even feasible. Pressure for smaller numbers can lead to promises being made that might not even be possible.
The Real cost of Bad Estimation
When estimation fails everything downstream gets more difficult. Deadlines are missed, budgets are blown, teams get frustrated, stakeholders get stressed and trust can be damaged.
If fixed costs have been quoted to deliver then the company delivering could take a huge hit depending upon how well they have documented their estimate. If time and materials then there has to be careful management to explain any change and agree new budgets.
What Great Estimation Looks Like
Great estimation involves:
- Using scope models to visualise the scope. Any good scope model needs to show the objectives, clear boundaries for what is in and out of scope and the interactions with other people and systems.
- Templates that help break the effort down per deliverable. This helps prevent items being missed.
- Setting out assumptions being made and risks. This is really important to ensure that clear what assumptions were made during the estimation process. If any of the assumptions prove to be wrong it makes it easier to communicate why the estimation was incorrect. Work done upfront to validate assumptions and mitigate risks will lead to better estimation.
- Having plans based on resource availability and realistic based on the dependencies that are encountered.
- Tracking the progress and learning lessons from any variances.
How to Fix It – The Ucentra STEP Process
Ucentra is a practical framework for project estimation. It helps teams move away from guesswork towards structured, evidence-based estimation, giving clarity to stakeholders and confidence in delivery.
It involves 4 Steps:
- Scope – Visualise the work
- Tally Effort – Estimate it properly in terms of effort
- Establish Plan – Map it realistically into elapsed time
- Progress – Track effort and learn
Work is scoped using a use case model diagram. This model gives early visibility of: Scope, Scale, Complexity and Stakeholders involved. It sets the foundation for all estimation and planning activities. This is a powerful tool to visually show what is required. I was once able to demonstrate why a project couldn’t be delivered in a short timespan because I could demonstrate using this diagram that there were not only over 80 different objectives but that interactive front end screens were required to interface directly with multiple stakeholders. Previously it was assumed that system to system end points were all that were required for sending data between systems. This model meant that further effort went into cutting back on the scope before moving to the next step of estimation.
To tally effort input is needed from all teams that will be required in the project. Each team should complete their own Use Case Estimations for their assigned Use Cases from the use case model. This ensures consistency in approach, transparency of assumptions, and clarity of ownership. Once all teams have completed their Estimations, the effort estimates should be collated into a single view using the Estimation Workbook. This creates a single source of truth for the project’s total effort, by team, by deliverable, before moving into planning and sequencing.
Effort then needs to be translated into a realistic delivery plan using a dependency map, followed by a project plan. This is because effort and elapsed time can be very different so it is important to take into account additional factors to understand the timeframes.
It is then important to track progress to understand and manage variances and to learn lessons for future improvement to the estimation process.
Here is the link to the UCENTRA playbook which provides more detail on how to use the UCENTRA Step process to improve your estimation.
Conclusion
Estimation will never be perfect — but it can absolutely be better.
With the right structure, clear assumptions, and collaborative effort, teams can move away from hopeful guesses and into confident, evidence-based delivery.
Using the Ucentra STEP Process helps teams bring more structure and transparency to their estimation approach, leading to better-managed projects.
Call to Action
Ready to leave estimation guesswork behind?
📘 Download the free Ucentra Estimation Playbook
🛠️ Book a Ucentra Estimation Workshop for your team
🚀 See how Ucentra can help you deliver smarter, faster, and more confidently
Get Started Here → www.businessbullet.co.uk/ucentra
