Have You Forgotten About Cost Management?
You’re in hell, knee-deep managing risk and schedules on your project. And even though you’re tracking the team’s progress and knocking down work visualized in the burndown chart ever so slowly, you may have forgotten to consider the impact your project has had on your original project cost plan.
The cry “I’m leading the team to deliver, what more do they want?” sure seems appropriate right about now. This article highlights a few simple best practices that, if introduced at the beginning of your project, might help you easily control costs along the way.
Value Engineering Comes First
Everyone has probably heard about earned value and has been exposed to cost and expense calculations that are used to evaluate if your project is on track. Needless to say, budgets and cost controls are key responsibilities for your role as project manager or ScrumMaster. In fact, some management wants to see project progress communicated only in terms of cost.
Value engineering refers to getting more out of a project without sacrificing scope. Notable examples include increasing the bottom line (profits), decreasing costs, shortening the schedule and hopefully improving quality while you’re at it. If costs spiral out of control, the value may be diminished.
Types and Usage of Project Costs
Speaking of costs, there are two types of
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