Introduction |
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Cost control is concerned with:
Cost control includes:
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7.4.1 Inputs |
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Refer cost baseline.
Performance reports provide information on cost performance - which budgets have been met and which have not. Performance reports may also alert the project team to issues which may cause problems in future.
Change requests may occur in many forms and may require increasing or decreasing of project budget. Most change requests are the result of:
Refer to cost management plan.
A cost change control system defines the procedures by which the cost baseline may be changed. It includes the paperwork, tracking systems, and approval levels necessary for authorizing changes. The cost change control system should be integrated with the overall change control system.
Performance measurement techniques help to assess the magnitude of any variations which do occur. The important part of cost control is to determine what is causing the variance and to decide if the variance requires corrective action.
Prospective changes may require new or revised cost estimates or analysis of alternative approaches.
Project management software and spreadsheets are often used to track planned costs vs actual costs and to forecast the effects of cost changes.
Revised cost estimates are modifications to the cost information used to manage the project. Appropriate stakeholders must be notified if needed. Revised cost estimates may or may not require adjustments to other aspects of the overall project plan.
These are a special category of revised cost estimates. Budget updates are changes to an approved cost baseline. These numbers are generally revised only in response to scope changes. In some severe cases "rebaselining" is needed to provide a realistic measure of performance.
This refers to anything done to bring the expected future project performance in line with the project plan.
An estimate at completion (EAC) is a forecast of total project costs based on project performance. The most common forecasting techniques are some variation of:
The causes of variances, the reasoning behind the corrective action chosen, and other types of lessons learned from cost control should be documented so that this information becomes part of the historical database for both this project and other projects of the performing organization.