Project Cost Control
Cost management is one of the fundamental and yet most challenging tasks for a project manager.
Projects fail for many reasons, but I believe that the hardest one to handle and to dig out from is the one that is heading for financial ruin.
Six actions you can take to gain control over a project budget that isn't too far gone or to make strides on gaining some degree of control.
The ability to create an accurate budget is an essential skill for a project manager. Here's what you need to create an accurate budget for your next project.
Are you suffering a budget overrun? Here's 3 key things you can do mid-stream on a project to help get the budget back in line with the original plan.
Project CAPEX estimating is a difficult exercise for non-standard projects, because of the variety of situations that can influence project success.
Total cost of ownership (TCO) is a financial estimate that helps enterprise managers determine direct and indirect costs of a product or system.
Project estimations do not need to be too complicated. There are tools, methodologies and best practices that can help project management teams.
In this last article of the series, I'll cover a potpourri of other estimating topics including the key outcome of estimating, converting effort estimates into budgets, dealing with poorly defined work and more.
This is the second of three articles on estimating. It may seem obvious, but the first requirement for developing an estimate is to know what you are estimating.
Good estimating is a skill like any other, it can be developed with practice to the point where it may seem like magic to the uninformed.
Do you have difficulty engaging in budget discussions for new projects? This article explores five ways to help you gracefully avoid backing yourself into a corner.
The accuracy of your cost estimation process can make or break project success. Learn the strategies that will help you gain control of this key area.
When you have finished planning your project, and you have all the scheduled dates, hours and costs agreed, why is it a good idea to store those values?
How do we know what a project will cost? We really don't until the project is complete because we can't accurately predict the future. What we can do is create an estimate.
Using a set of proactive estimating techniques to scope, plan and constrain your project conditions can dramatically improve your estimating practices.
Estimating is the process of forecasting a future result in terms of cost, based upon information available at the time. Many techniques, books and software packages exist to help with estimating project costs. A few simple rules will also help ensure you create an accurate and realistic estimate.
When forecasting the cost of maintaining a product use Boehm's Model, widely accepted as a valid model for predicting maintenance costs.
The Monte Carlo method is based on the generation of multiple trials to determine the expected value of a random variable. There are a number of commercial packages that run Monte Carlo simulation; however a basic spreadsheet (such as Microsoft Excel) can be used to run a simulation.
The cost benefit analysis is based on the comparison of a base case and one or more alternatives. For each case all the cash flows over a period of time are identified and organised into a spreadsheet. The bottom line is the net cash flow after tax. This series of cash flows can be converted to a present value (NPV) by using an appropriate discount rate.
Duration estimates are just that, estimates. The activities will occur in the future and there are no facts about the future. - David Hulett
Sunk costs don't matter. Don't make decisions based on how much money you've already lost. Make your decisions based on how much you expect to gain - or lose - going forward. You can't get back what's already gone. - Unknown Author
We didn't actually overspend our budget. The allocation simply fell short of our expenditure. - Keith Davis
Competition is the keen cutting edge of business, always shaving away at costs. - Henry Ford