Case: You work for an organization that builds training packets for industry clients. A client will

typically contract with your firm to build standard work and trainings for each position they

regularly hire for within their production process. Each time you create a training packet for a

client, you know from experience that you can capitalize on an $85\%$ learning rate. A recent

client is asking for an estimate of how much it will cost to produce trainings for $15$ different

positions on their production line. After an initial meeting with the client, you estimate that the

first training packet could be produced in $15$hrs of work. You also estimate the variable cost for

your organization at $$115$ per hour of development, with $$300$ in overhead costs per training

packet.

Estimate #$1$

You survey $3$ experienced Project Managers in the organization and receive the following bid

recommendations.

Optimistic Most Likely Pessimistic

Estimator #$1$ $$16,544$ $$18,237$ $$21,899$

Estimator #$2$ $$17,621$ $$19,019$ $$21,712$

Estimator #$3$ $$18,113$ $$18,547$ $$20,175$

What is your bid using a multiple estimator simple average?

What is your bid using a multiple estimator weighted moving average $($assume $4$x

weight on the most likely scenario$).$

Estimate #$2$

If your organization wants a $30\%$ profit margin above cost, what should you bid for the total

job?

What is your bid per training packet? $($bid should be evenly distributed$)$

Which is the first training packet where you should see a profit?

Deliverable $3$

Have you made any assumptions with either of the estimates above?