Top-down estimating, also known as “analogous estimating”, is a project management technique used to estimate the duration and cost of a project. It involves taking an existing project that is similar in scope and size to the one being estimated and using it as a reference point for the new project. This method relies on the experience of the estimator and their knowledge of past projects.
The top-down approach is often used when there is limited information available about the project or when time constraints prevent more detailed analysis. It can be used to quickly provide an initial estimate for planning purposes, but should not be relied upon as an accurate representation of the actual costs and duration of the project.
The main advantage of top-down estimating is its speed. It can be used to quickly generate an initial estimate without having to spend time gathering detailed information about the project. This makes it ideal for use in early stages of planning when time is limited.
Another advantage is that it can be used to compare different projects and identify which ones are likely to be more expensive or take longer to complete. This can help decision makers prioritize projects based on their estimated costs and timelines.
The main disadvantage of top-down estimating is that it relies heavily on the experience and knowledge of the estimator. If they do not have enough experience with similar projects, then their estimates may not be accurate.
In addition, this method does not take into account any unique features or complexities that may arise during the course of a project. As such, it should not be relied upon as an accurate representation of the actual costs and duration of a project.