Statistical analysis of deviation of actual cost from estimated cost using actual project data
This paper analyzes an association of a deviation of the actual cost (measured by person-month) from the estimated cost with the quality and the productivity of software development projects. Although the obtained results themselves may not be new from the academic point of view, they could provide motivation for developers to join process improvement activities in a software company and thus become a driving force for promoting the process improvement. We show that if a project is performed faithfully under a well-organized project plan (i.e. the plan is first constructed according to the standards of good writing, and then a project is managed and controlled to meet the plan), the deviation of the actual cost from the estimated one becomes small. Next we show statistically that projects with small deviation of the cost estimate tend to achieve high quality of final products and high productivity of development teams. In this analysis, the actual project data on 37 projects at a certain company are extensively applied.
statistical analysis software development project project plan deviation of cost estimate quality and productivity