Tricking the System: How to Track Costs for Projects with Internal Resources
When you study for your PMP® certification, it can sometimes get lost that there are a great number of projects initiated every day that will never have a formal budget associated to them. These projects, executed solely by resources internal to the organization, are no less critical to achieving the sponsoring organization’s objectives than the enterprise project requiring millions of dollars in professional services.
Therefore, it is important that PMs and management not lose sight that even internal projects can benefit from the rigor of cost management processes and earned value management principles.
When I began managing projects for an internal software development team, talking about the cost of a project was a bit taboo. The reasoning for this is two-fold: First, management typically sees internal development resources as free—not in the sense that they work for free, but that the expense of a full-time employee (FTE) is considered an operational expense and not a project expense. Secondly, depending on how the project manager is positioned within the organization, knowing the salary information (even the hourly rate of an employee) is typically frowned upon and, in most cases, against company policy.
While following company policy is important, it has the unintended consequence of limiting the number of tools at the PM’s
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