## A simple example of estimating using FPA

We follow the procedure as described in the page Four steps of estimating and illustrate how to estimate a project.

Successively the four steps are described:

1. Determine the functional size of the system to be developed
2. Determine the standard productivity rate for the development environment
3. Determine the expected project productivity rate
4. Budget the project

### 1. Determine the functional size of the system to be developed

Apply the way of working as described at the page Function Point Analysis of this cluster. For making a good FPA count, consulting the Nesma Counting Guidelines  is necessary.

Determine the number of function points in the scope of the project, based on the functional specifications of the project.
For this, we can conduct three different types of functional size analysis: either a detailed count, an estimated count, or an indicative count. These three functional size analysis types are explained at the page Additional FPA Guidelines of this cluster. The result of all three analysis types is a size in function points. The difference is the reliability of this size, but also the moment the analysis can be conducted. The reliability of the budget is related to the reliability of the count of the functional size. Typically the indicative count can be performed earliest, but the trade-off is the lowest reliability.

Suppose we want to budget a project with a functional size of 85 function points.

2: Determine the standard productivity rate for the development environment

Suppose the system will be written in Java. The functionality is moderately complex and the requested duration is 10 weeks. Phases to include are technical design, coding, unit testing, systems testing, support of the user organization during the user acceptance test and writing of the user manual.

Based on the history base with experience project data the company knows the standard productivity rate for this kind of project in this technical environment is 10 hours per function point (fictitious).

### 3: Determine the expected project productivity rate

The specific characteristics of this project are analysed using a check list with so called “productivity attributes”.
This analysis results in the conclusion that there are no specific conditions present that will influence the standard productivity rate. Hence the project productivity rate is set to the standard productivity rate: 10 hours per function point.

### 4: Budget the project

Suppose the standard productivity figures of the company include all project activities, except writing of the user manual. Then this activity needs to be budgeted separately. Suppose the estimate for writing of the user manual is 40 hours.
The budget of the project is then calculated as follows:

 Hours for activities included in the standard productivity rate: 85 fp  * 10 hour/fp 850 hours Hours for additional activities (not included in the standard productivity rate) 40 hours Project budget (in hours) 890 hours Project budget (in Euro), assuming a blended hourly rate of €150:  890 * €150 = € 133.500

To this project budget might need to be added other costs like travel expenses and costs for purchase of equipment.

### Confront the result

Finally, Nesma advises to also calculate a budget based on a “conventional” activity estimate of specialists. Compare this specialist estimate with the FPA estimate.

If such an expert estimate would be much higher, e.g. 2000 hours, then first scrutinize the expert estimate. What are the specific reasons that this project would be more expensive than similar projects in the past?
If there are such reasons known to the experts, and this is verified by the investigation, then there is good reason to raise the project budget. Else it is best to stick with the FPA estimate.
The same applies when the expert estimate is way lower than the FPA estimate.
If the expert and FPA estimates are not far apart, it could be a good strategy to set the budget in-between the two estimates.

Always keep in mind that the experts certainly do have a valuable opinion, and based on their inside knowledge might be right.
However the FPA estimate is based on the organizations own historic performance. This is a very good predictor for future similar projects.