Parametric estimating
“Parametric Estimating” is a tool/technique for the process “Estimate Activity Durations”.
Parametric estimating is an estimating technique in which an algorithm is used to calculate cost or duration based on historical data and project parameters. Parametric estimating uses a statistical relationship between historical data and other variables (e.g., square footage in construction) to calculate an estimate for activity parameters, such as cost, budget, and duration.
Activity durations can be quantitatively determined by multiplying the quantity of work to be performed by labor hours per unit of work. For example, activity duration on a design project is estimated by the number of drawings multiplied by the number of labor hours per drawing, or on a cable installation, the meters of cable multiplied by the number of labor hours per meter. For example, if the assigned resource is capable of installing 25 meters of cable per hour, the duration required to install 1,000 meters is 40 hours. (1,000 meters divided by 25 meters per hour).
This technique can produce higher levels of accuracy depending upon the sophistication and underlying data built into the model. Parametric time estimates can be applied to a total project or to segments of a project, in conjunction with other estimating methods.
“Parametric Estimating” is a tool/technique for the process “Estimate costs”.
Parametric estimating uses a statistical relationship between relevant historical data and other variables (e.g., square footage in construction) to calculate a cost estimate for project work. This technique can produce higher levels of accuracy depending upon the sophistication and underlying data built into the model. Parametric cost estimates can be applied to a total project or to segments of a project, in conjunction with other estimating methods.
This definition was found in the PMBOK V5
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