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What is the biggest problem in developing accurate cost estimates? Why?

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What is the biggest problem in developing accurate cost estimates? Why?

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The biggest problem in developing cost estimates is assessing the impact of potential risks that may arise during the course of a project. It is very difficult to assess the change in project coststhat occur due to unforeseen circumstances or risks inherent in the project and thus, the planned cost may differ greatly from actual costs incurred in the project.

One can easily estimate costs associated with the planned scope, if everything moves ahead as per schedule. However, it is often seen that the planned scope varies during the scope of the project or unforeseen events occur such as delays due to technical errors or bugs and thus, the course of action deviates from the ...

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Sandeep Bardia, MBA
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  • BCom, SGTB Khalsa College, University of Delhi
  • MBA, Rochester Institute of Technology
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