A project manager is working on an estimate.

According to the PMBOK® Guide, Bottom-up estimating is a method of estimating project duration or cost by aggregating the estimates of the lower-level components of the Work Breakdown Structure (WBS).

The Process: When the information is not available at a high level or when a high degree of accuracy is required, the project team starts at the most granular level—the work package. Each work package is estimated for cost or duration, and these estimates are then " rolled up " to higher levels (control accounts and eventually the total project).

Accuracy and Cost: This is typically the most accurate form of estimating because it involves the people actually doing the work. However, it is also the most time-consuming and costly technique to perform because of the level of detail required.

Prerequisite: This technique relies on a well-defined WBS. If the work cannot be decomposed into work packages, bottom-up estimating cannot be performed effectively.

Analysis of Other Options:

A. Three-point estimating: This technique uses three values (Optimistic, Most Likely, and Pessimistic) to calculate an estimate. While it can be used at the work package level, the act of " totaling work packages " is specifically the definition of bottom-up estimating.

B. Parametric estimating: This uses a statistical relationship between historical data and other variables (e.g., square footage in construction) to calculate an estimate. It is a " top-down " or mathematical approach rather than an aggregation of individual work packages.

D. Data analysis: This is a broad category of techniques (such as Alternative Analysis or Reserve Analysis) used throughout the project. It is not a specific estimating method for aggregating work package totals.