Estimation Tools - E & SD Values

These values are used to calculate an E value for the estimate and a standard deviation (SD) as L-estimators, where:

E = (a + 4m + b) / 6

SD = (b − a) / 6

E is a weighted average which takes into account both the most optimistic and most pessimistic estimates provided. SD measures the variability or uncertainty in the estimate.

To produce a project estimate we do the following:

1. Decompose the project into a list of estimable tasks, i.e. a work breakdown structure
2. Estimates the E value and SD for each task.
3. Calculate the E value for the total project work as E (Project Work) = Σ E (Task)
4. Calculate the SD value for the total project work as SD (Project Work) = √(Σ SD (Task) 2)

The E and SD values are then used to convert the project estimates to confidence levels. Information Systems typically use the 95% confidence level, i.e. E Value + 2 × SD, for all project and task estimates.