Some of the difficulties of estimating arise from the complexity and invisibility of
software
Subjective nature of estimating for example some research shows that people tend to
under estimate the difficulty of small task and overestimate the large ones
Political implications different groups within an organization have diff objectives
Changing technology, where technologies changes rapidly it is difficult to use the
experience of previous projects on new ones
Lack of homogeneity of project experience, even where technologies have not changed
knowledge about typical task durations may not be easily transferred from one project to
another because of differences in projects
the feedback from early increments improves the later stages
the possibility of changes in requirements is reduced because of the shorter time span
between the design of a component and its delivery
users get benefits earlier than in conventional approach
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Early delivery of some useful components improves cash flow, because you get some
return on investment early on.
Smaller sub projects are easier to control and manage
Return on investment (ROI) - also called Accounting rate of return (ARR): Is a way of
comparing the net profitability to the investment required
= (average annual profit/Total investment) x 100
Project 1:
= ((R1 847/5)/202 022 x 100) = 0.18 %
Project 2:
= ((R38 716/5)/317 250 x 100) = 2.44%
Project 3:
= ((R69 250/5)/364 750 x 100) = 3.80%
INF3708
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