Project Management

The Money Files

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A blog that looks at all aspects of project and program finances from budgets, estimating and accounting to getting a pay rise and managing contracts. Written by Elizabeth Harrin from GirlsGuideToPM.com.

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3 Levels of Project Work Authorization [Infographic]

What goes into a Control Account Plan?

2 unexpected benefits of risk management [Video]

Establishing the Budget in Earned Value Management

How to Monitor Risks

What to do when resource costs spiral [Video]

resource costs

When you have to pay for internal or external resources, the costs can soon mount up. It’s not difficult to find yourself with spiralling resource costs, even if they are just wooden dollars being moved between departments.

The most likely causes are poor estimating and too many change requests.

It’s often hard to drill down into the detail of where a resource is spending time, especially if you don’t have a timesheet application. If you don’t record time, then start doing that first! It will really help you improve your estimates over the longer term.

Short term, you need to sit down with your team and reforecast the whole project. If you then can’t afford to do all the work that you’ve planned out, you need a frank conversation with your project sponsor about what can be taken out of scope for this phase.

This video explains more.

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Posted on: March 02, 2021 01:55 PM | Permalink | Comments (6)

What to do when supplier costs increase [Video]

supplier costs increase

Let’s say your company has entered into an agreement with a supplier and now the bills are starting to rack up. This could happen if your agreement is on a time and materials basis, or a fixed price plus extra costs for changes to scope.

Find out why the costs are overrunning. Is it because your team is putting through too many change requests, which is hitting a contract clause that lets the supplier charge more? Or is something else at play? Whatever the cause, pin it down and work from there. Involve the supplier as well, so that they know that you can’t afford, or choose not to afford, to put up with those costs going forward. You may end up renegotiating the whole thing, but better to do that early than to put up with overspends for too long.

This video explains more.

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Posted on: February 02, 2021 02:05 PM | Permalink | Comments (3)

What do you do when you can’t track project cost? [Video]

Categories: cost

can't track project costs

What happens when you can’t track project cost?

This happens when other people are spending your project budget and not letting you know where it is going. The first you hear about resources being acquired or a deal being signed is when the invoice gets passed to you from Finance with a big question mark written on it. When this happens you can’t accurately keep track of what is being spent, and whether it is being spent on the right things. How to fix it: Sort out the process for spending money. Make it clear to the project team (even those people who are more senior than you) that purchase orders have to go through you for tracking, even if you don’t have the authority to actually sign them. Let the Finance team know as well so that they can be copying you in on requests and making sure that the process is adhered to. They have no interest in receiving invoices that can’t be paid or getting the company into debt with inappropriate suppliers so they will be on your side! Read more here:

https://www.projectmanagement.com/blog-post/17629/5-Common-Project-Budget-Problems--and-How-to-Fix-Them-

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Posted on: October 05, 2020 08:00 AM | Permalink | Comments (4)

What are sunk costs? [Video]

Categories: budget, cost

sunk costs

In this video I explain what sunk costs are and why they are so emotive on projects, especially when projects are challenged or no longer viable.

I try to give you some background on sunk costs so that when you’re faced with execs who are looking at sunk costs as a reason to continue with a project, you’re armed and ready to at least debate with them about why that isn’t a good idea!

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Posted on: April 23, 2020 08:00 AM | Permalink | Comments (5)

What is project cost control? [Video]

Categories: budget, cost, cost management

project cost controlProject managers often get concerned about project cost control. This video talks about what project cost control actually is and why you shouldn’t be worried about getting to grips with your budget. Most of what you have to do is the same type of ‘monitoring and controlling’ you do on other areas of the project, so it isn’t really that different… just with large amounts of cash attached!

This video aims to demystify project cost control and share some thoughts about just getting started.

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Posted on: March 03, 2020 09:00 AM | Permalink | Comments (0)
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