The document discusses cost estimation and control for projects. It outlines inputs, techniques, and outputs for estimating costs, developing a cost baseline and budget, and controlling costs using earned value management. Key steps include determining the project scope and work breakdown structure, developing cost estimates, setting a budget, and monitoring performance to track cost and schedule variance and forecast estimates to completion. The goal is to deliver the project according to the approved scope within the allocated time and funds.

1. By : Ahmed Zein
MBA E-Business
Eng_ahmedzein@yahoo.com

2. 1. Cost Estimation .
2. Determine Budget .
3. Control Costs .

3. Outputs :
Inputs : Techniques 1. Activity cost
1. Scope baseline 1. Expert Judgment estimates
(scope 2. Analogous 2. Basis of
statement+ wbs) estimation estimation
2. Schedule 3. Vendor bid 3. project
analysis document
3.HR plan update
4.
4. Risk register
5,6,7,8,9
5. E E F
6. O P A
1000 $$
50000 $$
1500$
3000 $$
2000 $$

4. Technique: Outputs :
Inputs : 1. Cost 1. Cost baseline
1. Activity cost aggregation 2. Project funding
estimates 2. Reserve analysis requirements
2. Basis of 3. Expert 3. Project
estimation . judgment document
3. Scope baseline 4. Historical Update .
4. schedule information
5. Calendar 5. Funding limit
6. Contracts reconciliation
7. OPA

6. Outputs :
Inputs : Technique: 1. Work performance
measurements
1. Earned Value 2. Budget forecasts .
1. Project Management
Management plan 3. Change request .
2.Forecasting
2. Project funding 4. Project plan update
requirements . 3. Performance
review . 5. Project document
3. Work update
performance 4,5,6
6. Organizational
information
process assets updates
4. OPA

7. Primary Data Points
Budget At Completion (BAC)
PV = BAC * % of planned work.
EV = BAC * % of Actual work
AC is the actual cost

8. Problem: A project has a budget of £10M and schedule for 10 months. It is
assumed that the total budget will be spent equally each month until the 10th
month is reached. After 2 months the project manager finds that only 5% of
the work is finished and a total of £1M spent.
PV = £2M
EV = £10M * 0.05 = £0.5M
AV = £1M
CV = EV-AC = 0.5-1 = -0.5M
SV = EV-PV = 0.5-2 = -1.5 months
CPI = EV/AC = 0.5/1 = 0.5
SPI = EV/PV = 0.5/2 = 0.25
EAC = BAC/CPI = 10/0.5 = £20M
ETC = (BAC-EV) / CPI = (10-0.5)/0.5 = £19M
TTC= (BAC-EV) / SPI= (10-0.5)/0.25 = 38 Months
This project will take TOTAL £20M (19+1) and 40 (38+2) Months to complete.