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- 1. PMBoK Discussion #5Project Cost Management<br />Alex Lutsaevsky<br />Ciklum Program Manager/Consultant<br />
- 2. Cost Management<br />2<br />www.ciklum.net<br />
- 3. Cost Management Plan<br /><ul><li>Can be formal or informal, but included to project management plan
- 4. How the estimates are stated and in which currency?
- 5. Rules for measuring the cost performance
- 6. Reporting formats for cost performance
- 7. Models
- 8. Control thresholds
- 9. Processes description
- 10. Direct and indirect costs management, etc.</li></ul>3<br />www.ciklum.net<br />
- 11. Estimate Costs<br />
- 12. Concepts<br /><ul><li>Life Cycle Costing
- 13. Value Analysis
- 14. Cost Risk
- 15. Variable costs vs. fixed costs
- 16. Direct vs. indirect costs
- 17. Bottom-up estimation
- 18. Reserve analysis</li></ul>5<br />www.ciklum.net<br />
- 19. Estimate Costs<br />Estimated direct costs, quality efforts, risk efforts, operational costs.<br />6<br />www.ciklum.net<br />
- 20. Determine Budget<br />
- 21. Determine Budget<br />Aggregating the estimated costs of individual activities to establish a cost baseline.<br />+<br />Reserves<br />=<br />Cost baseline<br />8<br />www.ciklum.net<br />
- 22. Cost Baseline<br />Cost performance baseline is a time-phased budget used to measure, monitor and control cost performance over the project.<br />9<br />www.ciklum.net<br />
- 23. Control Costs<br />
- 24. Earned Value Management<br /><ul><li>Planned Value, Earned Value, Actual Costs
- 25. Variances
- 26. Performance Indices</li></ul>11<br />www.ciklum.net<br />
- 27. PV, EV, AC<br />
- 28. Variances<br /><ul><li>CV (Cost Variance): difference between the budgeted cost of an activity and the actual cost of that activity.</li></ul>CV = EV – AC<br /><ul><li>SV (Schedule Variance): difference between the scheduled completion of an activity and the actual completion of the activity.</li></ul>SV = EV – PV<br />
- 29. Performance Indices<br /><ul><li>CPI (Cost Performance Index): The cost-efficiency factor representing the relationship between the actual costs expended and the value of the physical work performed.</li></ul>CPI = EV/AC<br /><ul><li>SPI (Schedule Performance Index): The schedule efficiency ratio of earned value accomplished against the planned value. The SPI describes what portion of the planned schedule was actually accomplished.</li></ul>SPI = EV/PV<br />14<br />www.ciklum.net<br />
- 30. Forecasting<br /><ul><li>Budget at Completion (BAC)
- 31. Forecasted Estimate at Completion (EAC) at the budgeted rate</li></ul>EAC = BAC + AC – EV<br /><ul><li>Forecasted Estimate at Completion (EAC) at the present CPI</li></ul> EAC = BAC / CPI<br /><ul><li>To-Complete Performance Index (TCPI) – projection of cost performance that must be achieved on the remaining to meet a specified goal</li></ul>(BAC – EV) / (BAC – AC)<br />15<br />www.ciklum.net<br />

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