Project Management

Topic Teasers Vol. 121: A Project Management Pricing Strategy

Heartland Nebraska / Iowa Chapter

Have a question you would like to submit as a potential Topic Teaser? Send a message to Barbee Davis today!

As a part of the new project management office in my company, I have been asked to become involved in setting a pricing strategy for the organization. That appears absolutely no place in A Guide to the Project Management Body of Knowledge (PMBOK® Guide), and I have no idea how to begin. Am I to be planning just the cost for the people on the project team, or do I need to know about other organizational costs? Are they actually going to use my work to decide how much our customers will pay? Eek!

A. Organizations who find that project management is a large part of their cost to do business may assess the team and project manager costs for a project or a product and then add 10% for corporate overhead. It is a simple and cost-effective way to come up with what to charge the customer.

B. As project managers move from simply management into more leadership roles, hopefully their range of involvement in the business will expand. Nothing could be more career advancing than to become the person who is researching, compiling and rolling out a plan in your organization to make sure the pricing structure is up to date, competitive and realistic.

C. Project managers get themselves into trouble when they step outside of their prescribed roles to…

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