Summary of project cost management

Source: Internet
Author: User

/project Cost management process: Cost estimation, cost budgeting, cost control.

Reasons for runaway costs include:

(1) The cost estimate and the cost budget work are not meticulous.

(2) There are no uniform standards and norms.

(3) Cost control is not well done.

    1. Cost estimate (Money):

(1) Definition: A cost estimate is an approximate estimate of the cost of the various resources necessary to complete the activities of the project.

Project Cost = project costs + profitability.

(2) Three steps:

Identify and analyze the constituent accounts of project costs;

Estimate the cost of each cost account according to the identified project cost constituent account;

Analyze cost estimation results and coordinate the proportional relationship between various costs.

(3) Input:

Enterprise environmental factors, organizational process assets, project scope specification, WBS, WBS dictionary, project management plan.

(4) Tools:

Analogy estimation method, determine resource rate, bottom-up cost estimate, project management software, seller bid analysis, reserve analysis, quality cost.

(5) Output:

Project cost estimation results, relevant supporting details files and results, request changes, cost management plans (updates).

2. Cost Budget (spend):

(1) Definition: It is the project's cost estimates are assigned to the project's specific work, to determine the project's work and activities of the cost ration, the development of project cost benchmark.

(2) Steps:

Allocate the total project cost to each work package of the project work breakdown structure;

The cost assigned to each work package is allocated two times to various activities;

Develop the project cost budget plan.

(3) Input:

Project scope specification, work breakdown structure, WBS dictionary, activity cost estimate, activity cost estimate support details, project schedule.

(4) Tools:

Cost total, management reserve, parameter model, the rationalization principle of expenditure.

(5) Output:

Cost baseline plan, project funding requirement, project management plan (update), request change.

3. Cost Control:

(1) Definition:

It is the project organization's management process to ensure that the actual cost of the project is controlled in a planned and budgeted manner by means of various methods, in order to guarantee the realization of its budgeted costs under changing conditions, in accordance with pre-developed plans and standards.

(2) Input:

Cost benchmarks, project funding requirements, project management plans, approved change requests, cost performance reports, job performance information.

(3) Tools:

Cost change control system, performance measurement, forecasting technology, project performance evaluation.

(4) Output:

Cost estimates (updates), cost baselines (updates), performance measures, forecast completion, requested changes, recommended corrective actions, organizational process assets (updates), project management plan updates.

Summary of project cost management

Contact Us

The content source of this page is from Internet, which doesn't represent Alibaba Cloud's opinion; products and services mentioned on that page don't have any relationship with Alibaba Cloud. If the content of the page makes you feel confusing, please write us an email, we will handle the problem within 5 days after receiving your email.

If you find any instances of plagiarism from the community, please send an email to: info-contact@alibabacloud.com and provide relevant evidence. A staff member will contact you within 5 working days.

A Free Trial That Lets You Build Big!

Start building with 50+ products and up to 12 months usage for Elastic Compute Service

  • Sales Support

    1 on 1 presale consultation

  • After-Sales Support

    24/7 Technical Support 6 Free Tickets per Quarter Faster Response

  • Alibaba Cloud offers highly flexible support services tailored to meet your exact needs.