Project management · Practical guide
Project Estimation: Three-Point Estimates, Budgets and Forecasts
By My First Task editorial team
Updated
The short answer
How to approach the work
Effort is the total work required; duration is elapsed time. Two people working in parallel may reduce duration without reducing effort, while approvals can increase duration with little additional effort. A three-point estimate helps expose uncertainty for one activity. A budget combines estimated labor and other costs. A throughput forecast describes a scenario based on past completion, not a contractual promise.
A practical sequence
- Define the deliverables and the work excluded from the estimate.
- Break the scope into reviewable activities and dependencies.
- State the unit for each estimate: hours, days, items or points.
- Record optimistic, most likely and pessimistic durations for uncertain work.
- Apply actual capacity and expected non-labor costs when building the budget.
- Review the forecast after a material change or a representative delivery period.
Illustrative scenario · not customer research
Worked example
A review task might take two days optimistically, five most likely and fourteen pessimistically. The PERT weighted estimate is six days, with an estimated standard deviation of two. This does not establish a probability of delivery by a particular date. For the budget, 120 labor hours at 50 units/hour plus 1,000 other costs give 7,000 base cost. An illustrative 10% allowance produces 7,700. The allowance must be justified from the project's risks.
Common mistakes to avoid
- Treating every activity as if it can run in parallel.
- Converting an average throughput into an unconditional deadline.
- Hiding scope exclusions or assuming all days are working days.
Try the method with your own inputs
Free tool
PERT Estimate Calculator
Combine optimistic, most likely and pessimistic estimates into a weighted planning estimate.
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Project Budget Calculator
Build a simple labor and non-labor project estimate with an explicit contingency allowance.
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Business Days Calculator
Count Monday-to-Friday days between two dates, excluding the start date and including the end date.
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Burndown Forecast Calculator
Estimate remaining working days from outstanding work and an observed daily completion rate.
ExploreQuestions answered
What is the difference between effort and duration?
Does PERT guarantee an accurate estimate?
How often should I update an estimate?
Apply it in a shared workspace
Keep the agreed owner, completion criteria and important decisions with the work. Explore the relevant My First Task feature.
Research context is available in our source library. The worked example above is an editorial illustration.
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ExploreMethod references
Turn the plan into shared work
Give each next action an owner, a completion condition and a realistic date. My First Task brings tasks, boards, project workflows and issue tracking into one workspace.