The document discusses project cost management. It describes that project cost management includes processes to estimate, budget, and control project costs so the project can be completed within budget. It discusses estimating costs as developing an approximation of monetary resources needed to complete project activities. Different types of cost estimates like order of magnitude, conceptual, preliminary and definitive estimates are described along with their typical ranges.
The concepts and processes on how to perform project cost management according to PMBOK Guide 6th edition. You'll find key concepts and terms, plan cost management, estimate costs, determine budget, and control cost.
The concepts and processes on how to perform project schedule management according to PMBOK Guide 6th edition. You'll find key concepts and terms, plan schedule management, define activities, sequence activities, estimate activity duration, develop schedule, and control schedule.
Chapter 07 of ICt Project Management based on IOE Engineering syllabus. This chapter covers the knowledge on development of project charters, direct and manage project execution, monitor and control project work and more.Provided by Project Management Sir of KU.
The concepts and processes on how to perform project cost management according to PMBOK Guide 6th edition. You'll find key concepts and terms, plan cost management, estimate costs, determine budget, and control cost.
The concepts and processes on how to perform project schedule management according to PMBOK Guide 6th edition. You'll find key concepts and terms, plan schedule management, define activities, sequence activities, estimate activity duration, develop schedule, and control schedule.
Chapter 07 of ICt Project Management based on IOE Engineering syllabus. This chapter covers the knowledge on development of project charters, direct and manage project execution, monitor and control project work and more.Provided by Project Management Sir of KU.
Project Cost Management includes the processes involved in planning, estimating, budgeting, and controlling costs so that the project can be completed within the approved budget.
Project Integration Management includes the processes and activities needed to identify, define, combine, unify, and coordinate the various processes and project management activities within the Project Management Process Groups.
Chapter 09 of ICT Project Management based on IOE Engineering syllabus. This chapter mainly focuses on cost and project, cost management, cost estimating and more related to cost and project. Provided by Project Management Sir of KU
In this chapter, you will learn how to:
✔ Use the Backstage view to open and save Project files.
✔ Work with commands on different tabs of the ribbon interface, the major visual
change introduced in Project 2010.
✔ Use different views to see Project information presented in different ways.
In this presentation we have done earlier a project for Phillip Morris (Pakistan) for the access control system and canteen management system. It is the project presentation for our subject Planning and Scheduling. i hope it is the best for the understanding Project planning and scheduling.
https://mloey.github.io/
We will discuss the following: Develop Project Charter, Develop Project Management Plan, Direct and Manage Project Work, Monitor and Control Project Work, Perform Integrated Change Control, Close Project or Phase.
Project Cost Management includes the processes involved in planning, estimating, budgeting, and controlling costs so that the project can be completed within the approved budget.
Project Integration Management includes the processes and activities needed to identify, define, combine, unify, and coordinate the various processes and project management activities within the Project Management Process Groups.
Chapter 09 of ICT Project Management based on IOE Engineering syllabus. This chapter mainly focuses on cost and project, cost management, cost estimating and more related to cost and project. Provided by Project Management Sir of KU
In this chapter, you will learn how to:
✔ Use the Backstage view to open and save Project files.
✔ Work with commands on different tabs of the ribbon interface, the major visual
change introduced in Project 2010.
✔ Use different views to see Project information presented in different ways.
In this presentation we have done earlier a project for Phillip Morris (Pakistan) for the access control system and canteen management system. It is the project presentation for our subject Planning and Scheduling. i hope it is the best for the understanding Project planning and scheduling.
https://mloey.github.io/
We will discuss the following: Develop Project Charter, Develop Project Management Plan, Direct and Manage Project Work, Monitor and Control Project Work, Perform Integrated Change Control, Close Project or Phase.
Project Procurement Management (PPM) includes the processes necessary to purchase or acquire products, services, or results needed from outside the project teams. It also includes the contract management and change control processes required to develop and administer contracts or purchase orders issued by authorized project team members.
- Cost is one of 3 Triple constraints of the project. Managing costs of the project is very crucial and hardest part of the project. It spans across all phases of the project right from conception to closure of the project.
- Cost Management is not just controlling “Costs”; it involves definitive planning and preparing budgets. Collecting cost associated data. Comparing the data to prepared budgets and taking appropriate actions when needed.
- The process involved in estimating, budgeting, and controlling cost so that the project can be completed within approved budget.
- Value analysis (value engineering)
• Looking at less costly way to do the same work within the same scope
Project cost management ,cost estimation cost control and evm for large epc projects and is essential for knowing the cost parameters for all construction engineers.
This is PMBOK Guide Planning Process Group Part three. It includes five Knowledge Area - Quality, Human Resource, Communications, Procurement and Stakeholder management - with five processes - Plan Quality Management, Plan Human Resource Management, Plan Communications Management, Plan Procurement Management, Plan Stakeholder Management - .
As a part of PMP training here are the slides of project cost management part 1 presented by Skillogic Knowledge Solutions.
If you are looking for PMP training in Chennai, Bangalore, Delhi, Pune, Hyderabad and Mumbai, visit Skillogic.
Online PMP Training Material for PMP Exam - Cost Management Knowledge AreaGlobalSkillup
Cost Management Knowledge Area in Project management defined by PMBOK 5th Edition by Project Management Institute (PMI). Provided by GlobalSkillup.com towards PMP Certification Exam.
WHAT IS COST ESTIMATION IN PROJECT MANAGEMENT AND THEIR TYPES?MirzaNuman1
There are different types of Cost estimation in project management. But, Here we have mentioned 4 types of cost estimation in project management that are most commonly used by cost estimators for construction.
Quantim is a time, cost, expense, resource, and project management system. At Quantim, we have 20+ years of vast experience working in the UK and worldwide in project management. We are the best emerging project management software and Timesheet App in 2020. Our project management tool will assist any company (large or small) with the day-to-day activities, from top to bottom-level project management tasks. Quantim’s resources and business intelligence will allow your company to succeed in all types of projects, with the most efficient and profitable outcomes.
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Instructions for Submissions thorugh G- Classroom.pptxJheel Barad
This presentation provides a briefing on how to upload submissions and documents in Google Classroom. It was prepared as part of an orientation for new Sainik School in-service teacher trainees. As a training officer, my goal is to ensure that you are comfortable and proficient with this essential tool for managing assignments and fostering student engagement.
The Roman Empire A Historical Colossus.pdfkaushalkr1407
The Roman Empire, a vast and enduring power, stands as one of history's most remarkable civilizations, leaving an indelible imprint on the world. It emerged from the Roman Republic, transitioning into an imperial powerhouse under the leadership of Augustus Caesar in 27 BCE. This transformation marked the beginning of an era defined by unprecedented territorial expansion, architectural marvels, and profound cultural influence.
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Under Augustus, the empire experienced the Pax Romana, a 200-year period of relative peace and stability. Augustus reformed the military, established efficient administrative systems, and initiated grand construction projects. The empire's borders expanded, encompassing territories from Britain to Egypt and from Spain to the Euphrates. Roman legions, renowned for their discipline and engineering prowess, secured and maintained these vast territories, building roads, fortifications, and cities that facilitated control and integration.
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Culturally, the Romans were eclectic, absorbing and adapting elements from the civilizations they encountered, particularly the Greeks. Roman art, literature, and philosophy reflected this synthesis, creating a rich cultural tapestry. Latin, the Roman language, became the lingua franca of the Western world, influencing numerous modern languages.
Roman architecture and engineering achievements were monumental. They perfected the arch, vault, and dome, constructing enduring structures like the Colosseum, Pantheon, and aqueducts. These engineering marvels not only showcased Roman ingenuity but also served practical purposes, from public entertainment to water supply.
Welcome to TechSoup New Member Orientation and Q&A (May 2024).pdfTechSoup
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Students, digital devices and success - Andreas Schleicher - 27 May 2024..pptxEduSkills OECD
Andreas Schleicher presents at the OECD webinar ‘Digital devices in schools: detrimental distraction or secret to success?’ on 27 May 2024. The presentation was based on findings from PISA 2022 results and the webinar helped launch the PISA in Focus ‘Managing screen time: How to protect and equip students against distraction’ https://www.oecd-ilibrary.org/education/managing-screen-time_7c225af4-en and the OECD Education Policy Perspective ‘Students, digital devices and success’ can be found here - https://oe.cd/il/5yV
The Indian economy is classified into different sectors to simplify the analysis and understanding of economic activities. For Class 10, it's essential to grasp the sectors of the Indian economy, understand their characteristics, and recognize their importance. This guide will provide detailed notes on the Sectors of the Indian Economy Class 10, using specific long-tail keywords to enhance comprehension.
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In Odoo, the multi-company feature allows you to manage multiple companies within a single Odoo database instance. Each company can have its own configurations while still sharing common resources such as products, customers, and suppliers.
2. Connoisseur Solutions
Project Cost Management
Project Cost Management includes the processes involved in estimating,
budgeting, and controlling costs so that the project can be completed
within the approved budget.
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3. Connoisseur Solutions
Cost Management Processes
Process Process Group
Plan Cost Management Planning
Estimate Costs Planning
Determine Budget Planning
Control Costs Monitoring and Controlling
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4. Connoisseur Solutions
Estimate Costs
Estimate Costs is the process of developing an approximation of the
monetary resources needed to complete project activities. The table below
shows five different types of estimates that can be used based on the need.
Estimate Type Range
Order of Magnitude Estimates -25% to +75%
Conceptual Estimate -30% to +50%
Preliminary Estimate -20% to +30%
Definitive Estimate -15% to +20%
Control Estimate -10% to +15%
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5. Connoisseur Solutions
Direct Cost- Any cost that is identified specifically with a particular final
cost objective.
Indirect Cost- Any cost not directly identified with a single, final cost
objective (more than one project)
Fixed Cost - Periodic charge that does not vary with business volume
Variable Cost - Cost that fluctuates based on the business volume
Opportunity Cost: When there is a decision to be made between two
opportunities, the opportunity cost is the value / money forgone for the not
doing the project.
Types of Cost
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6. Connoisseur Solutions
• Lifecycle Costing: Takes into account cost of development of a project
and also the cost of supporting during the lifecycle.
• Sunk Cost - Cost already incurred which cannot be recovered regardless
of future events
Types of Cost
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7. Connoisseur Solutions
Plan Cost Management
The process that establishes the policies, procedures , and
documentation for planning , managing , expending , and
controlling project costs.
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8. Connoisseur Solutions
Plan Cost Management
Inputs Tools and Techniques Outputs
Project Management
Plan
Project Charter
Enterprise
Environmental Factors
Organizational Process
Assets
Expert Judgment
Analytical Techniques
Meetings
Cost Management
Plan
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9. Connoisseur Solutions
Plan Cost Management- Inputs
Project Management Plan component that is important for this process are
primarily the scope and cost baselines.
Project Charter provides the summary budget from which the detailed project costs
are developed . It also defines the project approval requirements that will influence
the management of the project costs.
Enterprise Environmental Factors include factors such as Organization
structure/culture, Market conditions, currency exchange rates (for project sourced
from more than one country) that influence the project cost.
Organizational Process Assets include financial control procedures , historical
information . Existing formal and informal cost estimating and budgeting related
policies, procedures and guidelines.
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10. Connoisseur Solutions
Plan Cost Management- Tools and Techniques
Expert Judgment – Guided by historical information, provides valuable insight about
the environment and information from prior similar projects. Judgment based upon
expertise in an application area, knowledge area , discipline, industry can be useful in
this process.
Analytical Techniques – Some of the techniques payback period, return on
investment, internal rate of return, discounted cash flow and net present value can be
useful in this process
Meetings - Project teams may hold meetings planning meetings to develop the cost
management plan. These meetings may include, project sponsor, project manager,
selected team members , selected stakeholders, anyone with responsibility for project
costs.
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11. Connoisseur Solutions
Plan Cost Management- Outputs
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 plan can establish the following.
Units of measure - Each unit of measure for each resource.
Level of precision – The degree to which activity cost estimates will be rounded up
or down.
Level of accuracy - The acceptable range (e.g. +_ 100%) used in determining
realistic activity cost estimates is specified , may include an amount for contingencies.
Control threshold – Variance threshold for monitoring cost performance may be
specified to indicate an agreed – upon amount of variation to be allowed before some
action need to be taken.
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12. Connoisseur Solutions
Plan Cost Management- Outputs
The cost management plan also contains.
Rules of performance measurement – Earned value management (EVM) rules of
performance measurement are set. For example
Define the points in the WBS at which measurement of control accounts will be
performed
Establish the earned value measurement techniques (e.g. weighted
milestones, fixed formula, percent complete, etc) to be used and
Specify tracking methodologies and the earned value management
computation equations for calculating projected estimate at completion (EAC)
forecasts to provide a validity check on the bottom-up EAC
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13. Connoisseur Solutions
Estimate Cost
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Estimate cost is the process of developing an approximation of the
monetary resources needed to complete project activities. The key
benefit of this process is that it determines the amount of cost
required to complete project work.
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14. Connoisseur Solutions
Estimate Costs
Inputs Tools and Techniques Outputs
Cost Management Plan
Human Resource
Management Plan
Scope baseline
Project Schedule
Risk Register
Enterprise
Environmental Factors
Organizational Process
Assets
Expert Judgment
Analogous Estimating
Parametric estimating
Bottom-up estimating
Three-point estimates
Reserve Analysis
Cost of Quality
Project management
estimating software
Vendor bid analysis
Group decision – making
techniques
Activity Cost
estimates
Basis of estimates
Project document
updates
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15. Connoisseur Solutions
Estimate Costs - Inputs
Cost management plan – The cost management plan defines how project costs will
be managed and controlled . It includes the method used and the level of accuracy
required to estimate activity cost.
Human Resource Plan provides detail on Project staffing attributes, personnel rates,
and related rewards/recognition, these are necessary components for developing the
project cost estimates.
Scope baseline include inputs from scope statement, Work Breakdown Structure and
WBS dictionary.
Project Schedule provides detail on the type and quantity of resources and the
amount of time which those resources are applied to complete the work of the project,
all these factors directly impact the cost
Risk Register provides input related to costs associated with risk response
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16. Connoisseur Solutions
Estimate Costs - Inputs
Enterprise Environmental Factors include availability of resources, published
commercial information
Organizational Process Assets – include cost estimating policies, historical
information, cost estimating templates and lesson learned
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17. Connoisseur Solutions
Estimate Costs -Tools and Techniques
Expert Judgment guided by historical information, provides valuable
insight about the environment and information from prior similar projects. Expert
judgment can also be used to determine whether to combine methods of estimating and
how to reconcile differences between them.
Analogous Estimating relies on historical information (Previous projects executed by
the organization) to predict the cost of current project. This is a top-down approach is
good for fast estimates to get a general idea of what the project may cost. The accuracy
depends upon how similar the two projects actually are.
Parametric estimating uses a mathematical model based on known parameters to
predict the cost of a Project. A parameter can be cost per unit, cost per cubic yard etc.
Two Parametric estimating techniques are Regression Analysis and Leaning curve.
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18. Connoisseur Solutions
Estimate Costs -Tools and Techniques
Bottom-up estimating produces a separate estimate for each scheduled activity. The
detailed cost is then summarized or “rolled up” to higher levels for subsequent reporting
and tracking purposes. The cost and accuracy of bottom-up cost estimating is typically
influenced by the size and complexity of the individual activity or work package.
Three-point estimates concept originated with the program evaluation and review
technique (PERT). PERT uses three estimates to define an approximate range for an
activity’s cost:
Triangular Distribution
Estimated Cost = Optimistic + Most Likely + Pessimistic)/ 3
Beta Distribution
ESTIMATED COST = (Optimistic + 4*(Most Likely) + Pessimistic) / 6
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19. Connoisseur Solutions
Estimate Costs -Tools and Techniques
Reserve Analysis adds reserve amount (Contingency) to the cost. This is done to take
care of uncertainties in the project.
Cost of Quality includes assumptions related to Cost of Quality
Project management software is helpful in performing calculations, Organizing and
storing large amount of information needed for preparing cost estimates and for
reporting purpose
Vendor bid analysis may include analysis of what the project should cost, based on the
responsive bids from qualified vendors.
Group Decision Making Techniques Team – based approaches , such as
brainstorming, the Delphi or nominal group techniques, are used for engaging team
members to improve estimate accuracy and commitment to the emerging estimates.
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20. Connoisseur Solutions
Estimate Costs - Outputs
Activity Cost estimates details how much it would cost to complete each schedule
activity on the project
Basis of estimates include supporting documentation of the cost estimates and it
may include documentation of the basis of estimates , documentation of all
assumptions made , documentation of any known constraint , indication of the range
of possible estimates and indication of the confidence level of the final estimates
Project document updates include project risk register and cost management plan
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21. Connoisseur Solutions
Revise Tools to Estimate Cost
Exercise : Estimate Cost
1. You figure out a best case scenario and , a likely scenario and a worst
case scenario. Then you use a formula to come up with an expected cost
for the project. The tool used by you is ________
2. John creates a document with all the historical information from similar
project he had done in past and also takes input from a contractor who
provides his input. The tool used by John is_________
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22. Connoisseur Solutions
Revise Tools to Estimate Cost
Answers to Exercise : Estimate Cost
1. You figure figures out a best case scenario and , a likely scenario and a
worst case scenario. Then you use a formula to come up with an
expected cost for the project. The tool used by you is Three-point
estimate
2. John creates a document with all the historical information from similar
project he had done in past and also takes input from a contractor who
provides his input. The tool used by John is Expert Judgment
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23. Connoisseur Solutions
Determine Budget
Determine Budget is the process of aggregating the estimated costs of individual
activities or work packages to establish an authorized cost baseline. This baseline
includes all authorized budgets, but excludes management reserves.
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25. Connoisseur Solutions
Cost Management Plan - describes how the project costs will be managed and
controlled
Scope baseline refers to collection of approved project scope statement and its
associated WBS and WBS dictionary.
Activity cost estimates of a work package is a summation of the activity cost
estimates of activities under the work package
Basis of estimate includes supporting detail for cost estimates contained in the basis
for estimates should specify any basic assumptions
Project Schedule helps in mapping the cost back to time for planning purpose
Determine Budget - Inputs
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26. Connoisseur Solutions
Resource Calendars along with Project schedule will help plan for when the costs will
be incurred
Agreements Applicable agreement information and costs relating to products,
services or results that have been or will be purchased are included when determining
the budget.
Organizational Process Assets include cost budgeting policies procedures ,
guidelines and reporting method
Determine Budget - Inputs
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27. Connoisseur Solutions
Determine Budget – Tools and Techniques
Cost Aggregation involves aggregating the costs of individual activities to work
packages that are further aggregated to higher levels of WBS and finally into the
project cost
Reserve Analysis include contingency reserve and management reserves for the
project. Contingency reserves are allowances for response plan strategized for the
identified risks. These are also known as “known unknowns” . Management reserves
are allowance for unplanned changes to thee project scope and cost. The are also
known as “unknown unknowns”. Reserves are not the part of the project cost baseline.
Expert Judgment can be taken from experienced consultant in the project application
area. This can be from an internal organizational resource or external sources
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28. Connoisseur Solutions
Determine Budget – Tools and Techniques
Historical relationship result in parametric estimates or analogous estimates that
involve parameter to develop mathematical models to predict total project costs.
Funding limit reconciliation refers to reconciliation of planned spending with the
funding limit
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29. Connoisseur Solutions
Determine Budget – Outputs
Cost performance baseline is an authorized time-phased budget at completion
(BAC) used to measure, monitor, and control overall cost performance on the project.
It is developed as a summation of the approved budgets by time period and is
typically displayed in the form of an S-curve, as is illustrated in Figure below
(Reference PMBOK 4th edition). In the earned value management technique the cost
performance baseline is referred to as the performance measurement baseline (PMB).
Reference PMBOK 5th Edition
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30. Connoisseur Solutions
Determine Budget – Outputs
Project funding requirements are derived from cost baselines. Total funding
requirement is sum of cost baseline and management reserve.
Project document updates include updates to risk register, cost estimates and
project schedule
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32. Connoisseur Solutions
Revise Tools to Determine Budget
Exercise 2: Determine Budget
Monika reads a newspaper article that says there has been sharp increase in steel
cost recently. She knows this was not in her contractor’s original plan and decides to
put a few hundred dollars aside to deal with the price hike if it should happen. The
tool used by Monika is
• Parametric estimating
• Reserve analysis
• Cost aggregation
• Fund Limit Reconciliation
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33. Connoisseur Solutions
Revise Tools to Determine Budget
Answers to Exercise 2: Determine Budget
Monika reads a newspaper article that says there has been sharp increase in steel
cost recently. She knows this was not in her contractor’s original plan and decides to
put a few hundred dollars aside to deal with the price hike if it should happen. The
tool used by Monika is
• Parametric estimating
• Reserve analysis
• Cost aggregation
• Fund Limit Reconciliation
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34. Connoisseur Solutions
Control Costs
Control Costs is the process of monitoring the status of the project
to update the project budget and managing changes to the cost
baseline.
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35. Connoisseur Solutions
Control Costs
Inputs Tools and Techniques Outputs
Project management
plan
Project Funding
Requirements
Work Performance
data
Organizational Process
Assets
□ Earned value management
□ Forecasting
□ To-complete performance
index TCPI
□ Performance reviews
□ Project management software
□ Reserve analysis
Work performance
Information
Cost forecasts
Change Requests
Project
management plan
updates
Project document
updates
Organizational
Process assets
updates
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36. Connoisseur Solutions
Project Management Plan contains Cost management plan and Cost performance
Baseline, these are helpful in controlling the cost.
Project Funding Requirements As explained earlier include projected expenditures
plus anticipated liabilities
Work Performance Data provides information on the status and cost of project
activities and ensures that the project goals and objectives are met as per the project
management plan
Organizational Process Assets that can influence this process include cost
budgeting policies, procedures, guidelines , cost budgeting tools and reporting
methods
Control Costs - Inputs
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37. Connoisseur Solutions
Control Costs – Tools and Techniques
Earned value management is used to measure the performance of the project, It
integrates project scope, cost, and schedule measures to help the project management
team assess and measure project performance and progress. The EVM technique
involves evaluating the planned value , Earned Value and the Actual cost for each
schedule activity , work package or control account.
1. Planned Value (PV) is the authorized budget assigned to the scheduled work to be
accomplished for a schedule activity or work breakdown structure component. It is
also known as Budgeted Cost of Work Scheduled (BCWS)
2. Earned Value (EV) is the value of work performed expressed in terms of the
approved budget assigned to that work for a schedule activity or a WBS
component. It is also known as Budgeted cost of Work Performed (BCWP)
3. Actual Cost (AC) is the total cost actually incurred and recorded in accomplishing
work performed for an activity or work breakdown structure component.
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38. Connoisseur Solutions
Control Costs – Tools and Techniques
Variance Analysis helps in analyzing the performance of the project vis-à-vis cost
and schedule baselines
Schedule Variance (SV) is a measure of schedule performance on a project.
It is equal to the earned value (EV) minus the planned value (PV). SV= EV-PV.
Cost variance (CV) is a measure of cost performance on a project. It is equal
to the earned value (EV) minus the actual costs (AC). CV = EV-AC
Schedule performance Index (SPI) in addition to project status is used to predict
the completion date. SPI = EV/PV
Cost Performance Index (CPI) measures the cost efficiency for the work completed,
it is the ration of EV to AC. CPI = EV/AC.
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39. Connoisseur Solutions
Control Costs – Tools and Techniques
Forecasting Techniques are used to calculate Estimate at completion (EAC) and
Estimate to complete (ETC).
EAC = AC + ETC
EAC forecast for ETC work performed at the budgeted rate
EAC = AC + BAC – EV
EAC forecast for ETC work performed at the present CPI
EAC = BAC / cumulative CPI
EAC forecast for ETC work considering both SPI and CPI factors.
AC + [(BAC – EV) / (cumulative CPI x cumulative SPI)].
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40. Connoisseur Solutions
Control Costs – Tools and Techniques
To-complete performance index (TCPI) is the calculated projection of cost
performance that must be achieved on the remaining work to meet a specified
management goal, such as the BAC or the EAC.
TCPI based on the BAC: Work Remaining (BAC – EV) / Fund Remaining (BAC – AC).
TCPI based on EAC : (BAC-EV)/(EAC-AC)
Performance reviews involves following three types of analysis
1. Variance Analysis compares actual project performance to planned or expected
performance. Cost and schedule variances are the most frequently analyzed.
2. Trend Analysis examines project performance over time to determine if
performance is improving or deteriorating.
3. Earned value management compares the baseline plan to actual schedule and
cost performance.
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41. Connoisseur Solutions
Control Costs – Tools and Techniques
Project management software is often used to monitor the three EVM dimensions
(PV, EV, and AC), to display graphical trends, and to forecast a range of possible final
project results.
Reserve Analysis – During cost control, reserve analysis is used to monitor the status
of contingency and management reserves for the project to determine if these reserves
are still needed or if additional reserves need to be requested.
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42. Connoisseur Solutions
Control Costs – Outputs
Work Performance Information includes the calculated CV, SV, CPI, and SPI
values for WBS components, in particular the work packages.
Cost Forecasts includes a calculated EAC value or a bottom-up EAC value.
Organizational Process Assets Updates include Causes of variances, Corrective
action chosen and the reasons, and Other types of lessons learned from project cost
control.
Change Requests include change request to the cost performance baseline
or other components of the project management plan. Change requests can include
preventive or corrective actions and are processed for review and disposition through
the Perform Integrated Change Control process
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43. Connoisseur Solutions
Control Costs – Outputs
Project Management Plan Updates Elements of the project management plan that
may be updated include Cost performance baseline, Cost management plan.
Project Documents Updates include updates to cost estimates, basis of
Estimates
Organizational Process Assets Updates
Organizational Process Assets that may be updated include, but are not limited to :
Cause of variances
Corrective action choosen and the reasons
Financial databases
Other types of lesson learned from project cost control
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44. Connoisseur Solutions
Practice Earned Value Formulae
Exercise 1 : EVM
Your current project is an $800,000 software development effort, with
two teams of programmers that will work for six months, at a total of
10,000 hours. According to the project schedule your team should be
done with 38% of the work. You find that the project is currently 40%
complete. You have spent 50% of the budget so far. Calculate the
following
1. BAC
2. EV, PV
3. SV, CV
4. SPI, CPI
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45. Connoisseur Solutions
Practice Earned Value Formulae
Answer to Exercise - 1 : EVM
1. BAC = $ 800,000, AC = $ 400,000
2. PV = $ 80,000 * 38 / 100 = $ 304,000
EV = $ 80,000 * 40 / 100 = $ 320,000
3. SV = EV – PV = $ 16,000
CV = EV – AC = - $ 80,000
4. SPI = EV / PV = 1.05
CPI = EV / AC = 0.8
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46. Connoisseur Solutions
Practice Earned Value Formulae
Exercise – 2 : EVM
You’re managing a highway construction project. Your total budget is
$650,000, and there are a total of 7,500 hours of work scheduled on
the project. You check with your accounting department, and they tell
you that you’ve spent a total of $400,000. According to the schedule,
your crew should have worked 4,500 hours, but your foreman says
that the crew was allowed to work some overtime, and they’ve
actually put in 5,100 hours of work. Based on this Calculate the
following Earned Value numbers:
PV =
EV =
CV =
BAC =
AC =
SV =
SPI = , CPI =
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47. Connoisseur Solutions
Practice Earned Value Formulae
Answer to Exercise - 2 : EVM
BAC = $ 650,000
AC = $ 400,000
PV = 650,000 x 60% = $390,000
EV = 650,000 x 68% = $ 442,000
CV =442,000 – 400,000 = $42,000
SV = $ 52,000
SPI = 1.13 , CPI = 1.11
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48. Connoisseur Solutions
Practice Earned Value Formulae
Exercise - 3 : EVM
It’s nine months into your project. The total budget for your project is
$4,200,000. You’ve spent $1,650,000 so far, and you’ve got a CPI of
.875. Use the Earned Value Management formulas from forecasting to
figure out where things stand.
Find the following
EAC =
ETC =
VAC =
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