The Role of Organisational Phenomena in Software Cost Estimation: A Case Study of Supporting and Hindering Factors

Despite the fact that many researchers and practitioners agree that organisational issues are equally important as technical issues from the software cost estimation (SCE) success point of view, most of the research focus has been put on the development of methods, whereas organisational factors have received surprisingly little academic scrutiny. This study aims to identify organisational factors that either support or hinder meaningful SCE, identifying their impact on estimation success. Top management’s role is specifically addressed. The study takes a qualitative and explorative case study based approach. In total, 18 semi-structured interviews aided the study of three projects in three organisations. Hence, the transferability of the results is limited. The results suggest that the role of the top management is important in creating prerequisites for meaningful estimation, but their day-to-day participation is not required for successful estimation. Top management may also induce undesired distortion in estimation. Estimation maturity and estimation success seem to have an interrelationship with software process maturity, but there seem to be no significant individual organisational factors, which alone would make estimation successful. Our results validate several distortions and biases reported in the previous studies, and show the SCE research focus has remained on methodologies and technical issues.