Investigating Factors Affecting Accurate Software Cost Estimation

This report analyzes the factors that cause issues in accurately estimating the cost of new software development. It investigates the fundamentals of cost estimation, examines various models available to software developers, and identifies challenges faced in accurate cost estimation. The research employs an inductive approach and interpretivism philosophy, utilizing a qualitative study with primary data collected through surveys from 20 software developers and secondary data from journals and online articles. Thematic analysis reveals key themes, including types of costs involved in software maintenance (corrective, adaptive, preventive), techniques used for estimating costs (analogy-based, WBS-based), and difficulties faced by developers (time issues, networking, effort costs). The study also explores components incorporated in estimating total effort cost, the relevancy of application composition models, and the efficiency of models like COCOMO. The conclusion emphasizes the significant costs required for software maintenance and suggests using techniques like analogy and WBS-based methods to reduce costs and maximize performance, noting that ERP systems do not affect cost estimation, and expert judgment is valuable in estimating software costs. This report is available on Desklib, where students can find a variety of solved assignments and study resources.

Factors that cause issues in an accurate
cost estimation of a new developed
software

AIMS AND OBJECTIVES
Aim: To analyze the factors that cause issues in an accurate cost estimation of a new
developed software
The following are objectives of the study:
To investigate the fundamentals of cost estimation of a software project.
To examine various models available to the software developers to measure their cost
of the software.
To discover challenges or issues that is faced by the software developer in accurate
cost estimation.
To recommend the best model for measuring accurate or reliable cost of the new
designed

METHODS
Research approach- To analyse the issues faced by Software
firm, Inductive approach was adopted.
Research philosophy- Interpretivism philosophy was selected
by the researcher for the present study.
Research type- Qualitative study has ben carried out by the
researcher.

Continued…
Data collection- Primary data was collected through survey.
Secondary data was collected through journals, books and online
articles and blogs.
Sampling- With the help of purposive sampling, 20 software
developers have been selected.
Data analysis- data has been analysed through the technique of
thematic analysis.

RESULTS
 Theme 1: Types of costs involved in maintenance of the software- Corrective
costs are the major costs involved. The other costs involved are adaptive
maintenance costs, preventive maintenance costs and developer fees.

Theme 2
Techniques used for estimating costs- Majorly, analogy based techniques are used.
The second most used technique is WBS based.

Theme 3
Main difficulties faced by developers in cost estimations- Time issues are the major
issues that are faced by the developers. Other issues are networking and efforts costs.

Theme 4
Components incorporated in estimating total effort cost of the software- These
include heating and lighting costs, support staff costs and costs associated with social
security, central facilities and communication and networking costs.

Continued…
Theme 5: Relevancy of application composition model used for cost estimation-
majority of the respondents considered it as relevant.
Theme 6: Kind of models used for preparing cost measurement of software-
COCOMO is the most frequently used model. Other models are SLIM, True planning
software and SEER SEM.
Theme 7: Respondents are neutral that distributed object systems affect cost
estimations of a newly designed software- Equal number of respondents agreed as
well as disagreed.
Theme 8: Web services critically affect the cost estimations of newly developed
software- Majority of the respondents are neutral about this.

Continued…
Theme 9: COCOMO model is used for preparing cost estimates was efficient
enough- As per the respondents, out of all the models, COCOMO is the most
beneficial. It helps the entrepreneurs to derive the expenses and costs for the future
time period.
Theme 10: ERP or database centered systems did not affect the cost estimation-
As per the views of respondents, cost estimation is not affected by ERP or database
centered systems. In fact, use of these software helps the business to analyze its
performance. Also, it is able to compare with performance in the past.

Theme 11:
 Expert judgment was used in estimating costs of the software- Different types
of tools are used by management for estimating and determining costs for
software. Majority of the respondents considered expert judgment to be more
useful in estimating costs of the software.

CONCLUSION
 From the study it can be concluded that huge cost is required for maintaining the software. Software
development includes a number of costs that need to be born by the company. These include costs of
installation, maintenance and developers. Techniques such as analogy and WBS based method can
be used for reducing the costs as well as for maximizing the performance. The cost estimation of
software development is not affected by ERP. Issues related to time and networking are the major
issues that are faced by the organizations while estimating costs.