Top-Down versus Bottom-Up Estimating

•Top-Down Estimates

–Are usually are derived from someone who uses experience and/or information to determine the project duration and total cost.

–Are made by top managers who have little knowledge of the processes used to complete the project.

•Bottom-Up Approach

–Can serve as a check on cost elements in the WBS
by rolling up the work packages and associated cost accounts to major deliverables at the work package level.

Estimating Projects: Preferred Approach

•Make rough top-down estimates.

•Develop the WBS/OBS.

•Make bottom-up estimates.

•Develop schedules and budgets.

•Reconcile differences between top-down
and bottom-up estimates