Keep a Lid on It
Containing project costs within established budgets is a major challenge to corporate financial managers and those directly responsible for the profitability of a business unit. The uncontrolled drain of intellectual and fiscal corporate resources occurs when corporate management fails to implement adequate processes, policies and project management functions to contain project costs.
The purpose of this paper is to discuss this challenge, give examples how management and workforce attitudes can be affected by project overruns and provide suggestions on how to avoid them.
Causes of Project Overruns
Project cost and timeline overruns often occur as a result of these five conditions:
- Client requirements and expectations that are inadequately stated, documented or poorly understood
- Organizational structure
- Cost estimates/bid proposals
- Over-engineering the solution and
- Poor professional productivity
Regardless of your level of management, you must maintain a solid perspective of your client base. Whether your clients are internal to your company or new or existing external customers, you must thoroughly understand their business to successfully satisfy their requirements and meet their expectations. This is true whether your company is providing a product or a service
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