65 lines
1.7 KiB
Markdown
65 lines
1.7 KiB
Markdown
---
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id: risk-oriented-estimating
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aliases: []
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tags: []
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---
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# Risk Oriented Estimating
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Risk-Oriented Estimating (ROE), is a methodology for [[construction-estimating]] which
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* prioritizes estimating tasks,
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* determines necessary [[estimating-detail]]
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ROE leans heavily on [[perfect-information]],
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which challenges the natural tendency to shy from uncertainty
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with the reality of the cost of certainty.
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ROE does not endorse common shortcuts that round up to "cover" uncertainty,
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as these ultimately _increase_ risk by inflating the apparent project cost,
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increasing the probability of loss to a competitor.
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%%
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## Scratch
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Bid risk may fit a [Taleb distribution](https://en.wikipedia.org/wiki/Taleb_distribution).
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Actuarial Science
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Estimating as risk mitigation,
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resources allocated by Return on Mitigation (RoM)
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%%
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## Prioritizing Tasks
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ROE prioritizes estimating tasks by their contribution to _cost certainty_.
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## Determining Necessary Detail
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ROE determines the appropriate level of [[estimating-detail]]
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given an organization's [[risk#Risk Tolerance]].
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## EVPI Takeoff
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%%
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## Scratch
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Expected value of perfect information (EVPI)
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Count-based takeoff speed increases with count.
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%%
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Optimizing the takeoff process means:
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* *Minimizing* the need for information outside of drawings
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* *Maximizing* organizational consistency
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> [!note]
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> Recent events have complicated my philosophy above.
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> It appears that similar efforts have already been made here,
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> their success being a matter of perspective.
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> [!note] Naming Conventions (Use Case vs. Description)
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> Naming by use case is intuitive for those without estimating or field experience,
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> but has the side effect that those accustomed to the names will inevitably *treat them as descriptive*.
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