How to Produce Better Cost Estimates for Medium- to Large-Scale Software Development Projects

Volpe National Transportation Systems Center, Technical Reference Center2021PDFTech ReportTait, EdwinJohn A. Volpe National Transportation Systems Center (U.S.)Houston, ReginaBell, EllenJohn A. Volpe National Transportation Systems Center (U.S.)United StatesDevelopmentCost estimatingSoftwareProject managementBest practicesDOT-VNTSC-22-01FinalEstimating transportation-related software projects in the government space presents specific challenges, as software tends to be more complex due to advanced logic that is needed to implement business rules related to government regulation. The U.S. DOT Volpe Center has found that for multimillion-dollar software development projects, a duration based solely on effort and resource availability must be adjusted by a factor of 1.3 to produce a realistic schedule. Moreover, the mere act of thinking about tasks almost always turns up more project work that must be estimated. This type of orthogonal thinking is key to developing better estimates, since looking at the same problem from multiple perspectives will produce new insights. These insights can help improve the overall development estimate and project scope and schedule.125