In project estimation, what is typically the first step when considering historical data?

In project estimation, the first step when considering historical data is often top-down estimation. This approach involves using the overall project goals and objectives to make high-level estimates based on previous similar projects. By analyzing historical data, project managers can identify patterns, benchmarks, and previous costs, allowing them to make informed estimates for the current project.

Top-down estimation is effective because it allows for a broad view of the project's requirements and can help frame the scope and resources needed before diving deeper into more granular details. It is particularly useful in the initial stages of project planning, where a quick assessment is needed to communicate with stakeholders or secure funding.

While bottom-up estimation and other methods like the ratio method and parametric estimating provide valuable insights and data-driven estimations, they typically require more detailed input and analysis, making them less suitable as a first step when relying on historical data alone.