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Federal Procurement

Determine the Estimating Structure (WBS)

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Determine the Estimating Structure (WBS)

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Why does Step 4: Determine the Estimating Structure (WBS) matter?

Establish the Work Breakdown Structure (WBS) that will serve as the framework for organizing and presenting the estimate. The WBS provides a hierarchical decomposition of the total program into manageable, estimable elements. A well-constructed WBS ensures completeness, prevents double-counting, and enables cross-program comparisons.

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Key Activities

  • 1.Develop or adopt a product-oriented WBS per MIL-STD-881 (for DoD programs)
  • 2.Decompose the WBS to the level at which costs can be estimated with available data
  • 3.Map WBS elements to the Statement of Work (SOW) to ensure complete coverage
  • 4.Align WBS with the contractor's accounting structure for cost collection
  • 5.Identify cross-cutting elements (systems engineering, program management, test)

Deliverables

Work Breakdown Structure dictionaryWBS-to-SOW traceability matrixCost element structure mapping

Common Pitfalls

  • !Decomposing too deeply when data doesn't support that level of detail
  • !Missing cost elements that fall between WBS categories
  • !Not aligning contractor WBS with government reporting requirements

Adjacent Steps

Develop the Estimating PlanStep 2Define Program CharacteristicsStep 3Identify Ground Rules and AssumptionsStep 5Obtain DataStep 6

All Other Steps

Define the Estimate's PurposeStep 1Develop the Point EstimateStep 7Conduct Sensitivity AnalysisStep 8Conduct Risk and Uncertainty AnalysisStep 9Document the EstimateStep 10Present Estimate for Management ApprovalStep 11Update the Estimate to Reflect Actual CostsStep 12

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Bureauify. (2026). Determine the Estimating Structure (WBS) — Federal Contract Intelligence. Bureauify Federal Intelligence. Retrieved , from https://bureauify.com/glossary/determine-estimating-structure

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