Software Development Time Estimation: Algorithms and Influencing Factors

How long will it take to estimate the project time? The answer always will be, “It depends.” The reason is that software development time estimation is affected by numerous factors: project’s scope and complexity, product type, developing team’s experience, custom design, etc. That’s why it is challenging to say how long the development will take right off. But you can understand the time calculation algorithm and simplify the task.

Look through this guide to learn how to estimate software development time, what techniques are out there, influencing factors, and the average time spent during each stage of project creation.

Before delving deeper into why it is challenging to roll out an accurate estimate right from the beginning, let’s discuss the necessity of development time estimation.

According to the FinanceOnline research, about 70% of all projects fail, and wrong time estimation is one of the reasons for project failure. Time estimates provide value to both clients and their future partners. Even though the parties' goals are not equal, both are interested in an accurate software development time estimation.

To gain insight into how the time is calculated, here’s a software development time estimation formula:

Duration of the project = Overall time tasks estimation (which is E) + E * risk buffer + E * time eaters.

Risk buffers are issues that are hard to foresee; “time eaters” are time spent talking to PMs (as an example). Therefore, estimating software development hours is the amount of time required to implement all the project requirements, considering risk buffers and “time wasters”.

After understanding the value of a project time assessment, let’s see why it’s impossible to set accurate timeline expectations instantly. When you decide to build an app, you cannot expect your IT partner to inform you about the software development time right off the bat. Instead, they need to scrutinize your initial requirements first. It will help them understand the project's complexity, team capacity, risks that can influence the project's duration, and best fit methodology.

The most significant factors that affect development time variations are:

• Product variation
• Software complexity
• No strict requirements
• Customization of visual design (off-the-shelf or custom)
• Integration with other business software
• Migration of existing data

Now let’s discuss them in detail.

The product type (and project industry) is one of the factors affecting the software development time estimation. Is it an expense tracker app with simple architecture? Or integrated remote patient monitoring software for cardiac patients? Another point here is the software’s size. It’s based on the number of screens (or pages) that will be made. The more screens that are required, the longer it takes to build an app. Taking into account these points would help to significantly shape deadlines for software delivery.

Product complexity is also a pivotal point to consider when estimating software development time. Functionality, number, and difficulty of implementing features can significantly prolong the programming time. To give an idea of how much time the app building may require, we’re prepared a time breakdown based on its complexity. The numbers are provided by industry studies and our extensive experience in development time estimation.

• A simple app with basic functionality requires approximately 500-800 development hours and takes around 3-6 months to build
• An average-complexity solution takes 800-1200 hours and requires 5 to 9 months to develop
• A complex, rich features app in most cases exceeds 1200 hours and takes from 8 months and more to build

Moreover, depending on the solution’s complexity, programmers may need to use third-party API or code from scratch; all these factors also contribute to the increased development time.

The project time estimation is rolled out according to the project’s requirements and description of the idea. If you don’t have a final vision of your product or your requirements will change along the way, it is also tough to establish a reasonable timeline for the project. This is why the business requirement document and project specification must be compiled. Speaking as many details about your future solution as possible, you’re less likely to experience an unexpected timeline, thus, budget expansions.

UI/UX design services imply a wide range of tasks: user research, competitive analysis, UX design, interaction design, mobile app interface design, graphic design, app icons, logo design, and much more. A custom design will take more than a standard one that employs pre-built templates and themes. Adding animations, custom illustrations, and unique user interface elements increases the software development time. Besides, it’s not sufficient to fill the app with a bunch of details— all the components should be intuitive, convenient, and eye-pleasant. Finally, the more unique the app's pages, the more time designers will need.

You'll most likely need to integrate your software with existing business systems. It can be either simple or not. It will depend on the number of integrations and the difficulty of incorporating them with specific solutions. For instance, it's not that challenging to integrate primary payment gateways like Stripe or Braintree. However, it requires time, effort, and expertise to consolidate, for example, load planner software with different logistics management systems.

The trick is that you don't know beforehand how well specific solutions you want to integrate with let the information in or out. Moreover, ensuring smooth data synchronization is vital to avoid the risk of info duplication or failure. As such, the software development estimate can fluctuate from one project to another according to integration complexity.

In some cases, you may need to transfer a large data series from one system to a new solution. Although migration is relatively straightforward, it affects software engineering time estimation. Everything starts with custom script creation that takes the data that should be retrieved from the legacy app and moved to the new one. But, designing the custom script requires defining the translation rules (information needs to be modified to fit your new solution), writing the actual script, and then executing a set of tests to guarantee it migrates appropriately. All these actions take time.

There are two approaches to estimating software development: traditional and Agile. Each includes a set of software development time estimation methods, the most common ones we'll describe below.

A conventional or waterfall-like approach that projects have strict requirements and don’t change over time. The system demands divide into easy-to-estimate pieces of work under the Work Breakdown Structure concept (WBS). It’s a tree structure that visualizes each stage of app development and centers on the deliverables.

After the WBS is finished, the team estimates software development time for each task. Here are the core methods that can be applied:

Estimation by Analogy

The software development estimate is based on historical data. The specialists compare the current activity with a similar one that occurred in the past. It's mainly applied when the team has little information about the project and uses their experience working with analogous ones. If they see that the current assessment and real-time spent previously don't agree, then the team will know what activities are likely to raise the timeline.

Wideband Delphi

This method is a quick way to reach a consensus and make decisions. It's used when there are many experts involved, and they all have conflicting views, so it becomes challenging to get them to concur on a single decision. Instead, the team members individually evaluate WBS tasks, compare outcomes, pose issues, and negotiate each estimate.

This is the most widely-used approach to estimating software development time due to its iterative nature. Multi-tier software solutions (e.g., freight management systems, blockchain-based apps) are designed inside Agile SDLC to quickly respond to dynamic-changing requirements. Instead of investing 30-40% of the time on research and planning, the company focuses on high-demand requirements and assembles a dedicated development team to best fit the client's needs.

Agile estimation is the process of assessing the time required (hours or days) to fulfill a prioritized activity in the product backlog. Hours or days display how long it will take to complete this activity. The project is broken into multiple cycles called sprints, and each process passes through iterations until the small portions of the app are executed. Typically, each sprint takes 2 to 4 weeks to make the progress measurable and provide predictable outcomes.

Let’s take a quick look at the core stages of Agile software development estimation:

Step1. Conduct stakeholder interviews. The business analysts analyze the initial documentation and retrieve the gaps and queries. Then, they schedule regular workshops with stakeholders to negotiate these gaps and refine the doubts in the system workflow. After that, BAs present the business and functional requirements.

Step 2. Determine high-level product backlog. The business analysts and technical architects shape the initial results the stakeholders are waiting for with a solution. A high-level product backlog implies “the bare bones” of software. The expert team shapes the initial results the stakeholders are waiting for with a solution. Then, they check if the backlog meets the project's scope for the client.

Step 3. Understand the client and its audience. This step engages UI/UX designers on the board. They work on users’ profiles, the ecosystem in which users will be using the app, and users’ touchpoints within the system. Ecosystem maps, personas, user journeys, and storyboards are the stage deliverables.

Step 4. Prioritize requirements. The team deals with high-level backlog after the stakeholder has confirmed it. The solution architect decides which functionality to add first, which can be added later, and which ones to remove.

Step 5. Build an MVP. The BAs add must-have demands into the backlog and spot them as the requirements for MVP development. The MVP backlog also contains functionality as “should-have” to make the software stand out.

Step 6. Estimate the project timeline and cost. The team evaluates the MVP backlog to determine an approximate time frame (as well as price) for the first release. It’s followed by build and repeat until the team comes up with an estimation meeting the business needs. The agile approach also enables flexibility to integrate changes regardless of the app architecture stage.

After you’ve understood how to estimate software development time using Agile, let’s see what core estimation techniques are out there.

Planning Poker

The results are based on each team member’s input and consensus, contributing to a more precise development time estimation than other techniques. At the start of the planning poker, each person in the team holds a set of “pokers” cards with value, speaks the requirements for the item, and then offers their best estimate anonymously. The discussion lasts until consensus is achieved.

Affinity Grouping

The affinity grouping approach is a simple way to estimate the software development time. It's a great technique when: the project has just started and has a backlog that hasn't been evaluated yet or is in preparation for release planning. The team arranges similar items into groups of tasks. If the tasks are interlinked in scope and effort, they are compiled until a clear group set arises.

Three-Point Method

This technique uses three estimates instead of one to determine an approximate project duration:

• Optimistic Value (O): How much time will it take if all goes to plan?
• Pessimist Value (P): How much time will it take if things break down or there are obstacles coming?
• Most Likely Value (M): What is the most pragmatic estimate to fulfill the task?

With so many methods available, the team can provide a detailed estimate of the efforts required to create a digital product. Yet, there is another question: How can this effort be calculated? Here are the most popular units of measure for estimating software development hours.

Story points

It’s a metric used by agile teams to calculate the difficulty of realizing a particular User Story. An estimate of the effort involved can be influenced by the amount of work, risks and uncertainty, and the product’s complexity. Story points entrust a numerical value that points to their complexity. Then, this data is compared with a similar task of a previous project that has been estimated the same way.

Function points

Another method for software engineering time estimation is function points. It's a measure delineating the functional size of software products. Function points systematize metrics explaining a unit of product work fitting for quantifying apps based on the user’s requests & receives. Thus, it measures system functionality from the user’s point of view, like what the user receives from the software and what they request from it.

T-shirt sizes

Instead of assigning a numeric value to the tasks, the specialists give a size related to the standard t-shirt sizes, such as XS, S, M, L, and XL. So, for instance, the team can say, "we can deliver one extra-large task, three-large tasks, and seven small tasks in one sprint." This method is used for rough and early-stage estimations with a large backlog.

Now you know various approaches, methods, and tools for estimating software development time. Now, let's see the process for which the time estimation is calculated — the software development life cycle (SDLC).

This stage focuses on the activity performed before the client is acquired, such as searching and qualifying leads, market/product research, data, customer analysis, etc. Its core goal is to assist the sales and marketing team in finding, engaging, and renewing customers.

The Discovery phase is required to gather and systemize all the data received from a customer to build a product fitting their business needs and expectations. A business analyst and project manager schedule a series of meetings with a client to collect information, like what the customer wants to develop, the product’s purposes, target audience, business goals, etc. Once the requirements are defined, the SAD (Software Architecture Document) is made. The client also receives a rough and detailed software development estimate.

During this phase, an expert team models how an application works. Some aspects of the design include: choosing software architecture as well as platform and coding languages, defining the core user scenarios, feature visualization, user journey planning, and type of system security. The UI/UX designers also prepare an app prototype representing how the software will feel and look and its capabilities.

The coding phase begins once the engineers receive the Design document. The programmers build a server-side of the product, integrate APIs, and translate attractive UI into working software. All the functionality of the app is implemented at this stage. At Cleveroad, we follow the Agile SDLC methodology, namely the Scrum framework. The software is built in sprints (2-4 week periods) during which the developers complete a certain part of user stories. The team analyzes each story and comes to estimating software development hours required to finish the tasks.

The testing phase starts once the coding is finished and software modules are released for testing. Next, the QA engineers conduct manual and automation testing and any issues detected are assigned to programmers for further fixing. Finally, retesting and regression testing are executed until the app corresponds to the project's demands.

Once the product is tested, it is deployed in the production environment, or the first UAT (User Acceptance testing) is done depending on the customer’s expectation. In the case of UAT, the staging environment is made, and the customer, along with programmers, tests the functionality. Finally, if the app meets the client's expectations, it can be released to the end users.

At this stage, the SDLC is almost finished. The software is built and released. The support phase is still vital, though. The users may discover bugs that weren’t identified during testing that must be resolved. In addition to bug fixes, there may be a need to implement more sophisticated features or improve the old ones. Moreover, security and standards compliance must be verified regularly.

Earlier, we outlined the main factors influencing software engineering time estimation. However, in reality, there are many variables affecting the final time.

Constant changing requirements

If the work scope changes, so do time. Implementing new features or removing the pre-planned ones makes it challenging to adhere to the estimate. Anything that diverges from defined requirements and requires re-development or re-adding will increase the software engineering time estimation.

Specific technology stack

The stack can alter a project's cost and time. Depending on the project's peculiarities, the team might need to use complex tools, third-party APIs, or even search for custom solutions to some concerns. Thus, the software development estimate must cover the research and learning curve involved.

Estimator’s experience

The IT vendor’s experience also affects the accuracy of development time estimation. A team with more proficiency will surely fulfill a task faster than an inexperienced team; this quality reflects the team’s velocity — the amount of progress a team can complete in a set period. Therefore, choosing a competent software development company is vital. This way, you will be ensured of the accuracy of project evaluation and proper balance of cost and quality.

Now that you have a rough idea of the time app engineering takes approximately, let's look at the hints on how to estimate software development time correctly. Then, you can apply this knowledge to outline the right timeline expectations for your product creation process.

1. Determine project requirements

First, you should clearly understand the project and what it demands. The more details you provide, the easier it will be for the team to predict a time estimate. For instance, you want the users to log in. It seems to be a simple request. However, this vague sentence can range greatly depending on the type of login (e.g.email, social media), field restrictions, features of password security, etc. Every time a new point is added, the software development time increases. Bear this in mind. Therefore, every requirement should be straight and complete, so the business analysts can communicate well with other team members.

If you face difficulties outlining project requirements, Cleveroad experts will cover the research stage and consult you on the features to add first, tech stack, and system architecture. Our team will also provide you with customized project estimation and visual concepts of your product.

Request ballpark estimates

Before receiving the detailed software engineering time estimation, it’s good to ask for a general outlook of a project’s duration to set expectations. Commonly, software development companies prepare such an appraisal based on previous experience with such projects or industry benchmarks. A ballpark estimate will give you an insight into the amount of money you should count on. At Cleveroad, we provide our clients 2 rough estimates to enhance the cost accuracy step-by-step. The one estimate is formed on the presale stage and the second one after the completion of the Discovery Phase.

Be ready to face unforeseen circumstances

Even the most precise development time estimation cannot forecast force majeures, such as integration issues, the absence of specialists, the unpredictability of new technologies, etc. For such cases, IT companies have a strategy in place to manage unexpected situations and avoid common risks.

Receive a detailed project estimate

The comprehensive software development time estimation is provided after the project is planned out, including the solution's wireframes and specifications. It is executed with the obligatory participation of the developers, who will be directly involved in the product's creation. The dedicated team breaks the project into phases and tasks to set time limits for each. This way, you get regular updates on each stage and the time required to complete a particular part of the functionality. The detailed estimate can be provided within two to three business days if you have a ready-made documentation package.

Stay in touch with your tech team

Regular communication fosters a strong working relationship and helps you to reach excellent outcomes. Therefore, It’s essential to keep in touch with your IT partner and provide timely feedback. For instance:

• Agree on the acceptable frequency of communication
• Schedule dates for sprint reviews
• Select the preferred means of communication

This regular and open communication infuses confidence in receiving software meeting your goals and expectations. At Cleveroad, we prioritize integrity in cooperation and focus on long-term partnership and quality development to provide you with a goals-oriented product.

Cleveroad is an outsourcing software development company with more than 10 years of experience, during which we’ve successfully accomplished 170+ projects in multiple domains.

Cooperating with us, you get:

• Fast initial projects assessment from our experts: with no hidden costs and additional fees
• Sticking to Agile SDLC to achieve efficient outcomes and quickly release high-quality business capabilities
• Adaptable cooperation models: dedicated teams, staff augmentation, time & materials, and more
• A thorough consultation as to the project deployment: from problem identification to solution implementation
• Multi-industry experience: healthcare, logistics, retail, education, financial services, and more

We individually approach each solution to deliver a product on time and within the budget. Here is what your idea will go through:

• Step1. First contact. Your request goes straight to our Business Development manager with relative experience of your business domain. And you get contacted within 24 hours. We also sign an NDA as per your request.
• Step 2. Cleveroad’s Solution design workshop. It is a unique phase developed by our team for clients' convenience. After getting your request, we contact you, outline core business aims and needs, clarify the requirements. Based on the analyzed data, we prepare a rough software development time estimate, team composition, timeline, and form a proposal.
• Step 3. Discovery phase. We prepare a clear implementation plan to help you understand what to expect and how to get yourself prepared for this procedure. Feature breakdown list, design concepts, and a detailed estimate of the product creation cost are submitted at this stage.
• Step 4. Development and quality assurance. Software is built iteratively, from sprint to sprint. You and the development team reconcile a scope of work that needs to be completed during each sprint. BAs prepare user story requirements and UI/UX team draw up the design of your future app. User stories with designs linked get a detailed estimate. After you approve it, the coding phase starts. Once the team finishes all sprints, QA runs multiple tests to ensure software works as expected.
• Step 5. Release. The team makes final edits, and after that, your app is ready for launching. We also help with app releasing in app stores, or/and moving the website to the live server.
• Step 6. Maintenance. Your product may require improvements based on end-users feedback. We offer full-range IT maintenance and support services per your request.

Cleveroad is ready to define the timelines for your project and ensure it runs according to the plan, budget, and demands. Just tell us more about your idea, and our experts will provide you with rough and detailed estimates of your solution in the shortest time.