As per the PMBOK, the Estimate Activity Resource process has the following inputs,
tool & techniques, and outputs:

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Many of us may have been assigned to work on a project without fully knowing the project’s
background, or the full nature of the problem the project is intended to address. This is often because
during project initiation (the project phase in which we analyze whether a project is necessary), the
project team and even the project manager hasn’t been identified yet. We’ll look at some of the
stakeholders that are involved in the initiation phase a bit later, but it’s common for most project team
members to join a project after the approval (initiation) phase is complete.

Understanding why a project exists, however, and how it fits with larger organizational objectives is
the strongest way to unify a project team behind bigger- than-just-this-project goals. All members of a
project team should have the benefit of fully knowing the big picture, which is why we’ll examine what
“project initiation” documents should contain in this class. If project team members can’t be present
for the initiation process, as a project manager we can at least develop and provide our team with a
process summary.

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Inputs:
Schedule Management plan – the schedule management plan contains details on
schedule management guidelines, policies, procedures, methods, tools, etc.., as well
as the level of accuracy and the units of measure that may be used to estimate
activity resources
Activity List – This list will identify activities that will be evaluated for resource
requirements
Activity Attributes – Attributes give additional details of the activities to assist with
identifying resource requirement
Resource Calendars – These calendars show when and how long resources (such as
materials, equipment, manpower, and supplies) will potentially be available during
the project life cycle, Resource calendars may consider attributes such as experience,
skill level, expertise, capabilities, geographical locations, and other factors necessary
for human resources to identify the best resources and their availability.
Risk Register – The risk register contains the list of identified risks and their
probability, impact, priority, and response plan. Resource selection and availability
may be impacted by these various risk events in the project.
Activity Cost Estimates – Resource selection criteria such as number, type,
experience, and expertise are based on the cost of the resources.

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Tools & Techniques:
Expert Judgment – Any individual or group with relevant experience in relevant
experience in resource planning and estimating can bring insight into resource
requirements of the activities.
Alternative Analysis – There can be several approaches to perform the same task, and
the project team should spend time exploring the alternatives to identify the best
one for the project whenever possible. Actions such as purchasing an off-the-shelf
software components instead of building it, outsourcing a critical activity, adapting a
new creative approach to complete a task, using various types and levels of expertise,
using different sizes and types of equipment, or using different types of automated
tools can be examples of alternatives.
Publishing Estimating Data – there are extensive, quality, up-to-date data on
production rates and unit costs of resources available through well-known,
recognized sources that can help in estimating resource requirements.
Bottom – up Estimating – if the resource requirements for an activity cannot be
estimated due to the complex nature of the activity, then this activity can be further
broken down into smaller pieces of work until the resources can be estimated for
these pieces and later summed up from the bottom back up to an activity level.

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Outputs:
Activity Resource Requirements: Resource requirements such as resource types and
quantities for each activity in the work package are the key outputs. In order to
determine the requirements for the work packages, all of the requirements for the
activities under that package can be aggregated. The resource requirements
documentation should contain the basis of estimates, the decision – making process
used to arrive at the estimates, and the assumptions, availability, and quantity for the
activities.
Resource Breakdown Structure – A RBS is a graphical and hierarchical structure of the
identified resources arranged by resource category (such as labor, material,
equipment, and supplies) and type (such as expertise level, grade, and experience).

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As per the PMBOK, the Estimate Activity Duration process has the following inputs,
tools & techniques, and outputs:

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The estimate Costs process is focused on the development of an approximation of the costs
of all resources such as labor, materials, equipment, services, facilities, and any other special
items associated to each schedule activity. In order to achieve optimal cost for the project,
different options such as sharing on resources, buy versus lease, or make versus buy should
be considered. Cost estimates are predicated based on the available information at a given
point of time and should be reevaluated and refined as cost-associated risk, alternatives, cost
trade-off, and other factors are identified and more details become available. The accuracy of
the cost estimates will gradually improve as the project progresses. For example, in the initial
phase, a project may have a rough order of estimate in the range of -25 percent to +75
percent, but later on, the budget and definitive estimates will narrow the range of accuracy.
Some organizations have more specific guidelines on expected degrees of confidence and
accuracy in estimation and when and how cost estimate refinement should be done in the
project. However, for the most part, the following three estimates are used for cost
estimations:
Definitive (-5 percent to +10 percent): Used for bids, contract changes, legal claims, and
permit approvals.
Budget Estimates (- 10 percent to +25 percent): Prepared from flow sheets and used to
establish funds required and to obtain approval for the project
Rough Order of Magnitude (-25 percent to +75 percent): It is an approximate estimate made
without detailed data. This type of estimate is used during the formative stages for initial
evaluation of a project’s feasibility.

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As per the PMBOK, the Estimate Costs process has the following inputs, tools &
techniques, and outputs:

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Inputs:
Cost Management Plan – The project cost management plan is a component of the
overall project management plan, and it defines how the project cost will be plan,
managed, expended, and controlled throughout the project life cycle. It also defines
the degree of confidence and accuracy expected in cost estimation and methods that
will be used to estimate project activity cost.
Human Resource Plan: project staffing attributes, personal rates, and related rewards
and recognitions found in the human resource management plan are essential
components for developing the project cost estimates.
Scope Baseline: Scope baseline consists of the scope statement, the WBS, and the
WBS dictionary. Additional information on contractual and legal implications with
property rights, licenses, permits, safety, security, performance, insurance,
intellectual property, and the environment should be considered when estimating
cost.

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Outputs:
Activity Cost Estimates: Cost estimates address the cost of each schedule activity on the project
considering all relevant cost items such as labor, materials, equipment, services, facilities, interest
charges, currency exchange rate, contingency reserves, inflation allowance, and administrative items,
among other items. The estimate is expressed in units of currency and usually gets refined during
planning.
Basis of Estimates: A clear and detailed description of cost estimation may include the following;
A description of the work estimated (reference the WBS)
Explanation of the estimation development process
Documentation on known constraints and assumptions made
Indication of the range of results (+/-5 percent, $10k+/-$5k, etc.)

At the end of this module, remember that:
Estimate Activity Durations is performed after the Define Activities and at or around the same time as
Estimate Activity Resources
Estimate Activity Durations produces the activity duration estimates and
Several estimating techniques are involved with this process.
For more precision, estimate costs from the activity level and roll up to the project level
The quality of the estimate depends on the quality of the scope definition through activity planning and
processes
Multiple ranges of estimate accuracy may come into play during the life of the project
The project will cost what the project will cost; estimating allows for proper funding preparation.

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