How big does an agency need to be before it needs an estimator?
The answer, according to David Ladds, Managing Director of London-based 40-strong communications agency Bladonmore, is simple. You never need one.
That’s what he told us when we met up with him. But how can it be true?
Let’s glance at typical elements involved:
Anyone having to come up with an estimate is going to think about the risks involved. The classic three-point approach is to create three estimates: Optimistic, Pessimistic and Best Guess. But how do you weight the three numbers in order to come up with your estimate?
It is common to give the Best Guess figure the highest weighting. But it also makes sense to add to the mix:
Bottom-up and top-down
You might assume that a bottom-up estimate, where the people who will be involved with implementing the project create the estimate, will be exactly the figure you’re looking for.
However a top-down figure, where an appreciation of market rates for this type of work is factored in, is surely also going to become part of your mix.
Your firm will have prior experience that will greatly help in estimating.
Even if your colleagues have never done a job quite like this one, they will have a number of parallels that will help.
What is the availability of your key team members during the project? Will external resources need to be added?
Your client sees you as experts, so they will assume you need little time for research. In reality, this may be far off the mark. So don’t kid yourselves. It does you no favours to greatly underestimate research time in your internal figures. What you end up quoting to the client is one thing, but your estimate of actual costs needs to be realistic in order that the right decisions are made.
All of the above makes it seem hard to get estimates right. So how come Bladonmore say they don’t need a dedicated estimator to do it?
The answer is partly to do with empowerment of the team, and partly to do with getting a quality project management system.
Their MD said this:
“We don’t need an estimating department, we need everyone to be given the tools and the data to estimate their projects accurately.”
“So understanding just where our time is being spent is very important – both in terms of managing our business and serving our clients. Tracking this amount of data requires a non-trivial solution."
"My only regret is that we didn’t get to grips with this sooner.”
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