Plan Cost Management

1. Plan Cost Management

2. Plan Cost Management
Coincides with PMBOK 7.1
Process Group and Knowledge Area Mapping
Knowledge Areas Initiating Planning Process Group Executing Process Group Monitoring and Controlling Process Group Closing Process Group
4. Project Integration
Management
4.1 Develop Project Charter
4.2 Develop Project Management
Plan
4.3 Direct and Manage Project Work
4.4 Manage Project Knowledge
4.5 Monitor and Control Project Work
4.6 Perform Integrated Change Control
4.7 Close Project or Phase
5. Project Scope
Management
5.1 Plan Scope Management
5.2 Collect Requirements
5.3 Define Scope
5.4 Create WBS
5.5 Validate Scope
5.6 Control Scope
6. Project Schedule
Management
6.1 Plan Schedule Management
6.2 Define Activities
6.3 Sequence Activities
6.4 Estimate Activity Durations
6.5 Develop Schedule
6.6 Control Schedule
7. Project Cost Management
7.1 Plan Cost Management
7.2 Estimate Costs
7.3 Determine Budget
7.4 Control Costs
8. Project Quality
Management
8.1 Plan Quality Management 8.2 Manage Quality 8.3 Control Quality
9. Project Resource
Management
9.1 Plan Resource Management
9.2 Estimate Activity Resources
9.3 Acquire Resources
9.4 Develop Team
9.5 Manage Team
9.6 Control Resources
10. Project Communications
Management
10.1 Plan Communications
Management
10.2 Manage Communications 10.3 Monitor Communications
11. Project Risk
Management
11.1 Plan Risk Management
11.2 Identify Risks
11.3 Perform Qualitative Risk Analysis
11.4 Perform Quantitative Risk
Analysis
11.5 Plan Risk Responses
11.6 Implement Risk Responses 11.7 Monitor Risks
12. Project Procurement
Management
12.1 Plan Procurement Management 12.2 Conduct Procurements 12.3 Control Procurements
13. Project Stakeholder
Management
13.1 Identify Stakeholders 13.2 Plan Stakeholder Engagement
13.3 Manage Stakeholder
Engagement
13.4 Monitor Stakeholder Engagement

3. What is it?
Plan Cost Management is the process of defining how the project
costs will be estimated, budgeted, managed, monitored, and
controlled.
Why?
The key benefit of this process is that it provides guidance and
direction on how the project costs will be managed throughout the
project.
Plan Cost Management
Coincides with PMBOK 7.1

4. Overview
• The cost management planning effort occurs early in project
planning and sets the framework for each of the cost
management processes so that performance of the processes
will be efficient and coordinated.
• The cost management processes and their associated tools and
techniques are documented in the cost management plan.
• The cost management plan is a component of the project
management plan.
Plan Cost Management
Coincides with PMBOK 7.1

5. Plan Cost Management
Coincides with PMBOK 7.1
Inputs Tools & Techniques Outputs
1. Project charter
2. Project management plan
• Schedule management plan
• Risk management plan
3. Enterprise environmental
factors
4. Organizational process assets
1. Expert judgment
2. Data analysis
3. Meetings
1. Cost Management Plan
Inputs, Tools & Techniques, Outputs

6. Plan Cost Management
Coincides with PMBOK 7.1
7.1 Plan Cost
Management
Project
Management
Plan
Enterprise/Orga
nization
Project
Management Plan
4.1 Develop
Project Charter
• Cost management plan
• Schedule management plan
• Risk management plan
• Enterprise environmental factors
• Organizational process assets
• Project charter

7. Plan Cost Management - Inputs
Coincides with PMBOK 7.1
Project Charter
The project charter provides the preapproved financial resources from which the
detailed project costs are developed. The project charter also defines the project
approval requirements that will influence the management of the project costs.

8. Plan Cost Management - Inputs
Coincides with PMBOK 7.1
Project Management Plan
Project Management Plan components include:
• Schedule Management Plan
• Risk Management Plan

9. Plan Cost Management - Inputs
Coincides with PMBOK 6.2
Enterprise Environmental Factors
The enterprise environmental factors that can influence the Plan Cost
Management process include:
• Organizational culture and structure
• Market conditions
• Currency exchange rates
• Published commercial information
• Project management information
• Productivity differences

10. Plan Cost Management - Inputs
Coincides with PMBOK 7.1
Organisational Process Assets
The organizational process assets that can influence the Plan Cost Management
process include:
• Financial controls procedures
• Historical information and lessons learned repository
• Financial databases
• Existing formal and informal cost estimating and budgeting-related policies,
procedures, and guidelines.

11. Plan Cost Management – Tools & Techniques
Coincides with PMBOK 7.1
Expert Judgment
Expertise should be considered from individuals or groups with specialized knowledge
or training in previous, similar projects:
• Previous similar projects
• Information in the industry, discipline, and application area
• Cost estimating and budgeting
• Earned value management

12. Plan Cost Management – Tools & Techniques
Coincides with PMBOK 7.1
Data Analysis
A data analysis technique that can be used for this process includes but
is not limited to alternatives analysis. Alternatives analysis can include
reviewing strategic funding options such as: self-funding, funding with
equity, or funding with debt. It can also include consideration of ways
to acquire project resources such as making, purchasing, renting, or
leasing.

13. Plan Cost Management – Tools & Techniques
Coincides with PMBOK 7.1
Meetings
Project teams may hold planning meetings to develop the cost
management plan. Attendees may include the project manager, the
project sponsor, selected project team members, selected stakeholders,
anyone with responsibility for project costs, and others as needed.

14. Plan Cost Management – Outputs
Coincides with PMBOK 7.1
Cost Management Plan
The cost management plan is a component of the project management plan and describes
how the project costs will be planned, structured, and controlled. The cost management
processes and their associated tools and techniques are documented in the cost
management plan. The plan will establish the following:
• Unites of measure
• Level of precision
• Level of accuracy
• Organizational procedure links
• Control thresholds
• Rules of performance measurement
• Reporting formats
• Additional details (Description of strategic funding choices, Procedure to account for
fluctuations in currency exchange rates, and Procedure for project cost recording