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Question: Discuss About The Management A Systems Approach To Planning? Answer: Introduction Cost estimation involves the process of making an estimation regarding the cost of labor, material, infrastructure and the tools that should be incorporated to complete the project undertaken (Mislick Nussbaum, 2015). It is definitely one of the major responsibilities that project management must control with expertise. It can be considered as a driving force or better to say the impending factor that decides the future performance of the project (Pinto , 2015). Therefore, it is not difficult to realize the importance of the implementing proper cost estimation technique for managing a project with success. Difference Between Estimation And Target Or Goal : The words estimate is rather confusing and it is easily mistaken with target or goal. Estimation requires realistic assessment which involves facts related to the work previously conducted, as well as necessary resources , constrains and the environment closely associated with the project of interest. Whether Target or Goal can be attributed to the desired outcome or something that is committed or promised beforehand (Chih Zwikel , 2015 ). The author mentions that after the work is completed or result is obtained the estimation can be compared to the set goal or target to find necessary changes related to the origins of cost like work resources, workforce so that the modification can be done effectively. It is important to perform the estimation independently without any reference to the target and goal for better results. Once the outcome is revealed, it can then be altered by making necessary changes in the resources to meet the expectation of the set target as perfect as possible, but not before that. Preparing work responsibilities and necessary cost estimation: At the beginning of cost estimation procedure, the project is divided into smaller modules in terms of design, engineering, development and fabrication. Various team members under different work department related to the project meet with the team lead to decide corresponding team task and an estimated cost to execute the operations (Kerzner Kerzner ,2017). The work can be either completely developmental in nature or something that follows the existing or off- the-shelf (OTS) designs. The work based on the developmental model is usually difficult to execute as compared to the work based on OST , as the former requires expertise in terms of designing, testing and fabrication and as a result the cost estimation is often full of uncertainty which makes the it much more difficult to execute. Estimated cost is categorized into recurring and non recurring cost. Estimation cost can occur more than once during the project as it is associated with tasks which happens periodically, for example work related to testing and quality assurance. Non recurring cost is something that needs one time investment and happens only once in the project execution. To ensure better results there should be effective communication between the technical and financial team in order to better understand the estimation procedure and implement it successfully. Cost estimation techniques: To determine cost estimation four basic techniques are followed: opinion by expert, estimation with analogy, parametric estimation, and cost engineering (Tofallis , 2015). Opinion by expert: An expert opinion is referred to the estimation given by an expert who has an expertise in the particular field related to the project. However, expert opinion has some drawbacks as well. it is only useful when the project is in the conceptual phase. Apart from that expert opinion is also used when the topic of the project is not well defined or something that is unique and no similar project is conducted before from where ideas and comparison can be drawn to make decision. Estimation with analogy: An analogical estimation is prepared by making a thorough review of the cost management previously adopted in some projects similar in nature. This method can be adopted at any stage of the project execution (Idri , azzahra Abran , 2015). It is possible to assess general venture cost from the cost of a similar project; work bundle cost can be evaluated from similar bundle cost, practically equivalent to work packages; and errand cost can be evaluated from assignments that share similar structure. When a similar project is compared to evaluate cost estimation there can be difference between them in terms of time, scale ,location and complexity of the project. To make a successful estimation it is important to analyze those factors properly. As an example, if a project was performed 2 years before and a similar project needs to be executed one year from the present date, cost from the previous project needs to be adjusted for the inflation and price changes that may have occurred within the span three years. Parametric estimation: Parametric estimation is prepared with the help of empirical or mathematical model. Parametric estimation can be made with or without the help of an analogical project. The analogical project is usually taken into consideration when there is a need of cost scaling. However when the cost depends on the system or project parameters like volume , speed, capacity and performance, independent estimation is always preferred (Yang Li , 2015). Cost engineering: Cost engineering is another important aspect that decides the quality of cost estimation management. Cost engineering involves the analysis of cost , applied to individual cost categories related to the project works (Etienne et al. , 2017). The analysis is carried out in detailed manner to make the estimation more accurate and effective. The analysis follows bottomup approach by dividing the project into smaller activities or work modules which is further narrowed down into different cost categories . Even though the technique provides very accurate prediction, it is very time consuming which can be thought as a drawback of the process. Conclusion The cost estimation techniques gives a quantitative analysis of the cost related to the resources that is needed to complete the projects. It gives an initial overview of the cost requirement that is important to prepare an rough outline to give the cost management an structured direction. The effective cost estimation can give any project management the desired success it needs, still it is hard to execute as the process is full of uncertainty and needs expert insights. Like any structure cannot exist for long without strong foundation, project management also needs strong baseline in order to be successful. Cost estimation plays an prime role in creating that baseline which eventually leads to success of any project in any sector References: Chih, Y. Y., Zwikael, O. (2015). Project benefit management: A conceptual framework of target benefit formulation.International Journal of Project Management,33(2), 352-362. Etienne, A., Mirdamadi, S., Mohammadi, M., Malmiry, R. B., Antoine, J. F., Siadat, A., ... Martin, P. (2017). Cost engineering for variation management during the product and process development.International Journal on Interactive Design and Manufacturing (IJIDeM),11(2), 289-300. Idri, A., azzahra Amazal, F., Abran, A. (2015). Analogy-based software development effort estimation: A systematic mapping and review.Information and Software Technology,58, 206-230. Kerzner, H., Kerzner, H. R. (2017).Project management: a systems approach to planning, scheduling, and controlling. John Wiley Sons. Mislick, G. K., Nussbaum, D. A. (2015).Cost estimation: methods and tools. John Wiley Sons. Pinto, J. K. (2015).Project management: achieving competitive advantage. Prentice Hall. Tofallis, C. (2015). A better measure of relative prediction accuracy for model selection and model estimation.Journal of the Operational Research Society,66(8), 1352-1362. Yang, J., Li, H. (2015). Dense, accurate optical flow estimation with piecewise parametric model. InProceedings of the IEEE Conference on Computer Vision and Pattern Recognition(pp. 1019-1027).