Estimating the Cost of eLearning Projects (Session 101)

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Estimating the Cost of eLearning Projects
(Session 101)

• Mark Steiner
• DevLearn10
• San Francisco, CA
• Wednesday, Nov 3, 2010 1045 AM

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Session Agenda

• Introductions
• Session Approach
• Roles
• Milestones Deliverables
• Writing and Responding to RFPs

• Assumptions
• Estimation Types
• Estimation Techniques/ Spreadsheets
• Pitfalls
• Q A

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Who am I?

• BS Industrial Tech. 88
• MS Instructional Design 92
• 15 years eLearning interactive media dev.
  experience
• Dozens of projects from 2 min. to 33 hours in
  runtime

• Familiar with many development tools
• Presenter - eLearning Confs. US Europe
• Started own eLearning consulting company in March
  2001

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In what sector do you work?

• A. Corporate
• B. Academic
• C. Government/Municipality
• D. Other

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What is your role?

• A. Project Manager
• B. Instructional Designer
• C. Developer
• D. Other

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Whats an Average Project?

• A. 10,000 or less
• B. 10,000 - 50,000
• C. 50,000 - 100,000
• D. Greater than 100,000

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A Quote . . .

• All people who have turned out worth anything
  have had the chief hand in their education.
• Sir Walter Scott

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Session Approach

• I usually dislike when people say Oh, its an
  art.
• Art vs. Science Im going to attempt to identify
  as much of the science as I can.
• Science Process Remember the Scientific
  Method?
• Im a science / process person, therefore this
  session will have that sort of approach
• Ummm . . . Theres still some art to it. )

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Roles

• Strategy
• eLearning Project Manager
• eLearning Strategist
• Content
• Instructional Designer
• eLearning Programmer
• Instructional Developer
• Graphics
• Media Specialist
• Training Administrator

• Technology
• Technical Architect
• Integration Specialist
• Client
• Buyer
• Acceptor
• Project Manager
• Reviewer
• SME

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Milestones and Deliverables

• Needs Analysis
• Design Document
• Prototype
• Storyboards
• Scripts
• Media Development
• Course Alpha/Beta/Final
• Other Services

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A Calculator Example

• Comparing Traditional Learning to eLearning

Launch
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RFPs Poll

• A. Im not sure what RFP stands for.
• B. I know what it stands for but have never
  written one.
• C. I have written and/or responded to a few of
  them.
• D. I have written and/or responded to many of
  them.

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Writing RFPs

• Carefully and succinctly define the problem
• Define the RFP process Format, Protocol,
  Submission Requirements, etc.
• Determine key dates both in the RFP process and
  project milestones
• Determine evaluation criteria, check for internal
  company/department requirements
• Get help (inside or outside) if needed
• If you cant define the problem and are too
  vague, responding companies will have too little
  to go on, cause wide ranges of solutions and cost
  estimates. Perhaps consider changing the scope
  to only include analysis.

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Writing RFPs Sample RFP Outline

• Management Section
• Project management plan
• Delivery and acceptance
• Maintenance, Training, Documentation
• Vendor qualifications and references
• Price Section
• Cost of building the application
• Vendor software, third-party software
• System hardware required
• Project Management
• Installation
• Maintenance, Training, Documentation
• Appendices Technical /Contract Info
• Current technical infrastructure
• Corporate standards
• Sample contract
• Non-disclosure agreements

• Administrative Section
• Ground rules
• Bidders conference
• Relevant dates
• Proposal/submission format
• Mandates a proposal outline and
  pricing outline
• Evaluation Criteria
• Mandatory requirements
• Optional requirements
• Technical Section
• Description of current situation
• Current technical environment
• Current limitations
• Provide specific background information
• Provide specific examples
• Description of proposed environment
• Make requirements functional in nature

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Responding To RFPs

• Read the RFP very closely
• Quickly determine Go/No Go status
• Follow the RFPs prescribed process
• Do any colleagues have experience with the
  company and/or RFPs?
• Bidders meeting basics
• My opinion Unless youre a large company and/or
  have an In, it's a hard way to go.

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A Quote . . .

• Good fences make good neighbors.
• Mending Wall, by Robert Frost

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Another Quote . . .

• Problems that go away by themselves come back by
  themselves.
• Marcy E. Davis

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Documenting Assumptions

• Define everything that you can
• Client Participation
• Central Point of Contact
• Review and validation parameters
• Delay penalties
• Runtime

• Travel
• Project file formats
• Technical Specifications
• Duplication
• Revisions
• Knowledge Transfer
• List and Define any other Risks and Constraints

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Estimation TypesTime and Materials

• Usually an initial estimation of cost is given in
  a range (between X and Y)
• Risk is minimized for vendor
• Client only pays for hours worked
• Profit built into rate structure
• My advice If possible, always pitch analysis as
  initial step.

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Estimate Types Fixed Cost

• Key Point Fixed cost does not mean the cost can
  never change. It means that the cost is fixed to
  a scope. If the scope changes, so should the
  cost.
• It also assumes the scope is definable, so then
  the cost can be fixed (linked) to the defined
  scope.
• Risk is built into price. Add 15 40
• Why are there so many neon lights fine hotels
  in Vegas?
• When, then?
• Client requirement
• Repeated, consistent, well-defined project(s)
• Sometimes Vegas pays out big buck.

LXC4S
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Another Quote . . .

• Whenever things sound easy, it turns out theres
  one part you didnt hear.
• Donald E. Westlake
• Dig the well before you are thirsty.
• Chinese proverb

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Development Ratios

• Level 1 eLearning (Basic) Including content
  pages, text, graphics, perhaps simple audio,
  perhaps simple video, test questions.
• 491 - eLearning output, Rapid Development,
  Simple Content, Specialized Authoring Tools
• 791 eLearning output, Most typical (average)
  Level 1 eLearning Content
• 1251 - eLearning output, Complex projects,
  difficult to produce, more media production
• Level 2 eLearning (Interactive) Level 1
  eLearning content plus 25 (or more) interactive
  exercises, virtual try it exercises, liberal
  use of multimedia
• 1271 eLearning output, Rapid development
  through templated interactions, simple animation,
  efficient or low-end media production
• 1841 eLearning output, Most typical (average)
  Level 2 projects
• 2671 eLearning output, advanced and custom
  interactions, embedded simulation activities and
  lots of media
• Level 3 eLearning (Advanced) - Highly
  interactive, possibly simulation or serious
  game-based, use of avatars, custom interactions,
  award-winning caliber courseware
• 2171 eLearning output, templated interactions,
  templated games and simulations, efficient
  simulation development practices (rapid
  development)
• 4901 eLearning output, Most typical (average)
  Level 3 projects
• 7161 eLearning output, complex projects,
  advanced learning simulations and games,
  extensive media production

Source Citation Chapman, B. (2010). How Long
Does it Take to Create Learning? Research
Study. Published by Chapman Alliance LLC.
www.chapmanalliance.com
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Estimation Techniques

• Estimating Via Key Categories
• Estimating Via Run Time and Screens
• Estimating Via Detailed Screen Information
• Filling in the Details

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Estimating Via Key Categories

• Content/Research
• Technical Complexities
• Media Richness
• Launch Calculator

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Estimating via Run Time and Screens

• Whats an hour?
• 30-50 Screens per hour
• Based on mix of interactivity/screen type
• 10-30 seconds for text-only screen
• 1-1.5 minutes for MC questions

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Estimating Via Detailed Screen Information

• Occasionally, the detailed Design Document is
  already complete.
• Similar to Run Time, except for amount of info
  available. Analysis is finished-maybe.
• Less art, more science
• Build a matrix that contains all screen/
  interaction types. Assign a cost factor to each.
• Apply metrics to content to determine cost

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Filling in the Details

• A Spreadsheet via Roles
• A Spreadsheet via Process and Roles
• Using Microsoft Project

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Client CommunicationEstablishing Value

• Not to be a marketing weasel, but define and
  communicate your Value Proposition.
• But . . . find and use your own words.
• Leverage the situation so that it would be
  foolish and risky for the client not to heed
  your advice.
• If the former is not possible, perhaps it's not a
  project you should undertake.

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Another Quote . . .

• Smooth seas do not make skillful sailors.
• African proverb

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Pitfalls List

• Unclear scope
• Scope creep
• Unclear client/vendor roles
• No single point of contact with client/vendor
• Ill-defined system specifications
• Hours allocated to a task not sufficiently
  dissected/broken down
• Lack sufficient skill base to complete a project
  

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Final Quote . . .

• He who is afraid to ask is afraid of learning.
• Danish proverb

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Contact Information

• Mark Steiner
• mark_at_marksteinerinc.com
• 773-392-7967
• Chicago, IL
• See examples of eLearning Calculators, Reusable
  Learning Objects, related links, past conference
  slides and materials, and other information at
• marksteinerinc.com
• Click on Resources

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Thank you