Why do we need Risk register for Estimate Cost? Saving Changes...
Deepesh RammoorthyICT Project Manager ( PMP®AgilePM®Certified ScrumMaster® (CSM®))| Australian Red Cross Blood ServiceTarneit, Vic, Australia
Key word is "Estimate" If you are not certain about anything , it's a risk . If you look at Estimate Activity Resources and Estimate Activity Duration Processes in Time Management, what do you think is one of the inputs ? You guessed it , Risk Register.
Here, when you are going to Estimate Costs which is all the costs in your Project, based on aggregation of all costs of the individual activities, you will need to consider what individual activities are going to cost and you are going to have to apply some contingency reserves. The reserves are for known Unknowns. In other words, The risks that you know about. As an example, your project may need to hire an external Quality Assurance Person. That is a risk. You dont know for how long and you dont know what their end cost will be .You may approximate that they are needed for 2 months full time. But what if there are significant defects in your product? How do you pay to remedy that? Thats right , You put additional funds in for that resource. You apply contingency reserves for that activity. and That risk should be in your risk register already
The output is Activity Cost Estimates. Your final aim is to roll up all the costs , with their contingency and then determine the total budget which will be your next planning step of Cost Management Saving Changes...
