Rather than estimating effort and cost based on your experience, or with reference to a similar previous project or proposal, a parametric estimate uses a formula and "parameters" to define your estimate. For example if you are estimating design hours, instead of proposing 2 engineers, 3 designers and 1 draftsperson you could instead assign a formula for "number of hours per drawing x number of drawings". The hours per drawing and number of drawings are both parameters.

Parametric estimates have the distinct advantage of scaling your estimate easily and automatically for differing work-scopes. Once you have measured the time it takes for each drawing you can accurately estimate all sorts of design activities simply based on how many drawings you think each task requires. Parametric estimating does not however consider real-world scenarios like the hassle of having part-time resources or ramping up and down teams, so it is wise to look at the resource plan or full-time equivalent personnel per month resulting from your estimate, including parametric estimates.

There are several types or kinds of parameters as follows:

• Company wide parameters, such as hours to do a certain type of drawing, are predefined and cannot be edited in your estimate
• Proposal-wide parameters, or ones defined for the entire proposal such as number of sites where building work is being done. These estimates also cannot be edited in your estimate, instead contact the proposal team to define them
• WBS-specific parameters, such as the number of drawings for this specific WBS or assembly, or the % of software development hours for testing
• Resource-specific parameters which can be defined differently for each resource within a single WBS or estimate
• Rates, for example fringe, overhead or G&A rates, or escalation factors, which vary from one fiscal year to the next
• Base or automatically calculated parameters such as the number of software development hours. These parameters are not assigned a value because they refer to a set of labor estimates or costs which meet a set of conditions

Open your estimate and click on the PARAMETERS tab to view and edit your parameters.

1. BOE-WBS specific parameters - resource or WBS based parameters - are displayed first for you to assign values. These values apply to the estimate as a whole or in the case of resource-specific parameters you should also select which resource each value is assigned to
   • You can also assign parameter values in the formula popup when assigning a formula to your estimates
2. Fixed value parameters - for the proposal overall or rates or company wide parameters, are displayed with their values in the lower table. Show columns of company or year to display the different values for company-wide parameters or for rate parameters.