Improving the Accuracy of Early Cost Estimates for Software-Reliant Systems, First in a Two-Part SeriesMeasurement & Analysis , SEI Research , Software Cost Estimates No Comments »
The Government Accountability Office (GAO) has frequently cited poor cost estimation as one of the reasons for cost overrun problems in acquisition programs. Software is often a major culprit. One study on cost estimation by the Naval Postgraduate School found a 34 percent median value increase of software size over the estimate. Cost overruns lead to painful Congressional scrutiny, and an overrun in one program often leads to the depletion of funds from another. This post, the first in a series on improving the accuracy of early cost estimates, describes challenges we have observed trying to accurately estimate software effort and cost in Department of Defense (DOD) acquisition programs, as well as other product development organizations.