Project managers often wonder how much money they will spend to complete the remaining project works. If the remaining direct costs and indirect costs of the works are more than estimated, clients, funders, and stakeholders will be unhappy and they will start to question the project’s success. It is clear that accurate project cost estimation is one of the most important methods that helps to evaluate the project’s success. Basically, cost estimation is the practice of assigning a value to a task that incorporates a wide range of tools and techniques. For that purpose, Estimate to Complete (ETC) is a strong forecasting tool used along with the estimate at completion. Unlike the EAC (Estimate at Completion) which calculates the overall project expected budget, the ETC does not take into consideration what has been spent up to now. It calculates the cost from now to the completion of the project. In this article, we will discuss the concept and analyze the estimate to complete formula with examples to provide you a better understanding. Show
Simply put, this tool provides an approximate idea of how much money will be spent to complete the remaining balance of work. Estimate to Complete (ETC) Calculation MethodsIn Earned Value Analysis, there are four essential calculation methods that help you to make correct etimations for the future cost performance of your project. These are;
ETC (Estimate to Complete) allows the project manager to compare the funding needs required to finish the project with available funding. |