Government-Sponsored Organization

Capco develops cost-estimation framework for national organization’s multimillion-dollar IT projects

This government-sponsored national organization offers programs and services to help families secure credit for home mortgages. The enterprise works closely with a federal regulator to ensure liquidity, stability and affordability in the U.S. housing and mortgage markets.

Confronting challenges
In charge of more than 250 IT projects per year at an estimated average cost of $2 million per project, this government-sponsored enterprise faced large cost overruns. Its system development life cycle (SDLC) required no formal work effort estimation, increasing the company’s exposure to delivery risk and reducing management’s ability to make more informed decisions and course corrections when necessary.

Capco was engaged to create a tailored cost-estimation methodology to improve delivery precision, work effort estimates and resource forecasting. We helped the organization execute sustainable estimation activities across different project profiles to reduce delivery risk without sacrificing speed to market and strategic business focus. Our cost-estimation framework also helped improve management’s visibility into project execution and enable more timely and informed decisions before, during and after project execution, including the true cost of each initiative.

Working with the company’s existing project management capabilities, Capco developed a tailored cost-estimation framework that helped the organization achieve within 10 percent accuracy the costs for more than 70 percent of its IT project portfolio. Accurate forecasting helped the enterprise reduce its estimated operating budget by 13 percent, saving $65 million.

Key benefits

  • Enabled delivery teams to systematically estimate work effort, resourcing requirements and total project costs
  • Created consistent, repeatable and predictable estimating methodology aligned with the client’s existing SDLC preferences, including traditional waterfall and agile techniques
  • Developed a historical project estimate repository to help facilitate future calibration of the estimating methodology and analogous estimation of projects with similar scope, size and complexity
  • Designed training material that allowed the company to roll out the cost-estimation framework on its own
  • Provided senior management with greater transparency into scoping assumptions, estimating factors, sizing and budgets