IT project cost calculator
Whether your company is a large international enterprise, a startup in a rapid growth phase, or a mid-market company looking for efficient workforce solutions, Maxima Consulting is a flexible global partner that can scale up and down with your requirements.
Use the calculator below to estimate the cost of hiring new staff and managing your IT project team with Maxima Consulting.
About Maxima Consulting
Maxima Consulting is a people-centric organization providing strategy consulting, managed services, workforce solutions, and cloud expertise in various business models for clients across many industries. Everywhere, without exception, we strive to enhance our partners’ competitive advantage in today's fast-paced global economy.
We care for relationships with both employees and clients and focus on empowering our talented global workforce to exceed expectations. Our clients appreciate our initiative, accountability, performance, and the ability to bring down the cost of hiring new employees and the overall cost of labor.
Frequently Asked Questions (FAQs) about IT project cost estimation
How to make a cost estimation for an IT project budget?
Estimating project costs can be a difficult task, especially for complex projects in IT or engineering, but several effective cost-estimating techniques exist that can help streamline the process. By employing the three methods described below, you’ll be better equipped to create a realistic, manageable, and more accurate cost estimation for your IT project, helping to ensure its success.
1. Examine similar projects: One of the most reliable ways to estimate costs is to look at earlier project budgets that share some similarities with your new project. By analyzing previous projects’ expenditures, you can identify patterns and benchmarks that will inform the cost estimation of your current project.
Sure, market rates change all the time, so the resources required to hire all team members in 2014 are basically irrelevant. However, by examining historical data, you can notice things like hidden costs linked to infrastructure needs or licensing, unforeseen additional costs resulting from shifts in client requirements, or the impact of modifying a project schedule or a project’s scope on the real-life project budget.
Understanding the direct and indirect costs that had an impact on similar past projects allows you to better gauge how factors like scope, technology, and resource allocation impacted the previous project’s actual cost and use it to make a more accurate estimate this time.
2. Conduct simulations: Running simulations of several various project scenarios results in obtaining useful insights into possible project costs. By creating multiple hypothetical examples with varying parameters (including team size, technology stack, and timeline), you can better understand how such changes affect the overall budget.
This method allows you to formulate a more flexible project budget plan and prepare for a range of possible challenges, consequently increasing the odds of project success.
3. Use a budgeting tool: Leveraging digital budgeting tools (for example, spreadsheet templates or project management software) can significantly enhance the precision of your project cost estimation process.
Such tools usually allow you to input various cost factors in each project phase and automatically generate comprehensive budget forecasts so you can easily identify areas where costs might escalate. Maxima Consulting budget templates also allow you to track project costs and compare actual costs with cost estimates in real-time.
You can download our free budget templates from our resources library.
What is the actual cost of hiring an employee?
Being a senior IT specialist can mean many different things. Some employees become seniors based on their knowledge of internal procedures and company-specific requirements, and others because of their drive to grow and willingness to innovate constantly. It’s even more true with juniors, whose skill sets can vary from “almost zero” to “a lot but with little work experience.”
In this calculator, we have considered the upper ranges of market rates for hiring employees in the USA, Poland, and India. You obviously can find candidates that may be cheaper than that. However, from our experience, hiring self-motivated and accountable experts often comes with a higher cost, and we decided to reflect this in our cost estimation calculator.
Use our spreadsheet template to compare the costs of recruiting team members internally vs. with an outsourcing provider.
How accurate are the cost estimates this calculator provides?
The estimated costs in this calculator are based mainly on the average cost of employee salaries. The calculations do not include resources needed for recruitment, employee turnover costs, onboarding costs, and many other business operation costs.
Such expenditures can greatly differ depending on the project scope, industry-based project requirements, or other project-based specificities. With limited information about your project, we can only offer a ballpark estimate of your project costs.
To receive more accurate cost estimates, please use the form on the right to fill in your business email and check the “I want Maxima Consulting to send me a detailed quote based on these calculations” field before clicking the button. Our team will get back to you with more information within 24 hours.
What are the costs of IT outsourcing?
While IT outsourcing comes with many benefits, including cost savings, it’s essential to understand there are many outsourcing models available, and each can be more or less advantageous depending on the project deliverables needed.
Key factors to consider include labor costs in your outsourcing destination, state of the local education and job market, supplier’s service fees, and various production expenses. The invoices you pay to your IT service provider can also include the cost of recruitment, onboarding, additional training, equipment, office space, data management, and required security measures.
Generally speaking, choosing the right outsourcing model for your project requirements can greatly influence the overall project cost.
That being said, working with a trusted partner who possesses expertise in a particular region can significantly enhance your cost efficiency and allow your organization to unlock better value from its IT outsourcing investments.
Knowledge of the local job market, relevant regulations, and cultural differences allows specialized providers to uncover better opportunities, avoid unexpected costs, and mitigate potential challenges, ensuring that your expenses are well justified and the IT project progresses as it should.
Have more questions?
When calculating the total costs of an IT project, it’s essential to differentiate between fixed and variable costs.
Fixed costs are based on time and remain (generally) constant. They may include renting the office space, interest, insurance, salaries, and taxes.
Variable costs are directly associated with production levels and can fluctuate based on your current output. Examples of variable costs for an IT project include costs of needed software licenses and cloud infrastructure expenses (depending on currently required resources).
The straightforward formula for determining total cost is: Total Cost = Fixed Costs + Variable Costs.
Interestingly, when outsourcing an IT project, the cost of labor can become a variable cost. Depending on the specifics of your contract with the IT service provider, you may be able to scale the number of required external IT consultants up and down based on your changing business requirements, enhancing your ability to continue working on the project successfully regardless of market fluctuations.
For a detailed and accurate cost estimation based on your specific business needs and unique requirements, contact us to schedule a complimentary consultation with one of our experts. We will help you estimate project costs and provide solutions to reach your objectives with efficiency and reliability.