4 Inputs For Plan Cost Management For Projects
in my previous articles, I have talked about some of the factors that you need to consider when it comes to cost management for projects. In this article, I want to look at some of the inputs of plan cost management for projects. Follow me as we look at that together in this article.
Plan cost management is the process of defining how the project cost will be estimated, managed, monitored, and controlled. The key benefit of this process is that they provide guidance and direction on how the project costs will be managed throughout the project.
This process is performed once or at predefined points in the project.
The cost management planning efforts occurs early in the project planning and set the framework for each of the cost management processes and there associated tools and techniques are documented in the cost management plan. Please note that the cost management plan is a component of the project management plan.
#1 Project Charter
The Project Charter providers the pre-approved 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.
#2 Project Management Plan
Under the project management plan, we have the schedule management plan and the risk management plan for the project.
Schedule management plan: The schedule management plan establishes the criteria and the activities for developing, monitoring and controlling the schedule. The schedule management plan provides processes and controls that will impact cost estimation and management.
Risk management plan: The risk management plan provides an approach for identifying, analyzing, and monitoring risks. The risk management plan provides processes and controls that will impact cost estimation and management.
#3 Enterprise Environmental Factors
The Enterprise Environmental Factors that can influence the Plan Cost management process include: organisational culture and structure can influence cost management. Also, market conditions describe products, services, and results are available in the regional and global markets. The current exchange rates for project costs are sourced from more than one country.
It also includes published commercial material such as resource cost rate information is often available from commercial databases that track skills and human resource costs, and provide standard costs for material and equipment. Published seller price lists are another source of information.
Project management information system also provides alternative possibilities for managing cost. It also includes productivity differences in different parts of the world can have a large influence on the cost of the projects.
#4 Organisational Process Assets
The organisation process assets that can influence the Plan cost management include: Financial control procedures e.g time reporting, required expenditure and disbursement reviews, accounting costs and standards contract provisions. It also includes historical information and lesson learned repository. It may also include financial decisions and existing formal and informal cost estimating and budgeting-related policies, procedures, and guidelines.
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