May 20

Details on Cost Management Terms. Part – 11: Project Cost Management #PMP – Project Management

Details on Cost Management Terms. Part – 11: Project Cost Management

For now, this is just a place holder post

Schedule Performance Index (SPI): The rate at which the project is performing in respect of schedule expectations up to a point in time. SPI=EV/PV

Estimate at Completion (EAC): Forecast the total cost at project completion based on the project performance up to a point in time. EAC = BAC/CCPI

Estimate to Completion (ETC): How much more will be spent to complete the project based on past performance.

Variance at Completion (VAC): Difference between what was budgeted and what will actually be spent. VAC = BAC – EAC

Project managers need to calculate these values to get a good understanding of the project cost. He can get answers to questions like: How much is spent? How much more are required? Is the project progress satisfactory in terms of cost? — these will ultimately help in project cost control.

  From: http://sitestree.com/?p=11515
Categories:PMP – Project Management
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Post Data:2017-10-17 16:27:06

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May 20

Details on Cost Management Terms. Part – 10: Project Cost Management #PMP – Project Management

Details on Cost Management Terms. Part – 10: Project Cost Management

For now, this is just a placeholder post

Actual Cost: Money spent over the period

Cost Variance (CV): Difference between planned cost and actual cost. CV = EV – AC

Schedule Variance (SV): Difference between the planned schedule and actual schedule (as:Where the project is in the schedule). SV=EV-PV

Cost Performance Index (CPI): The rate at which the project cost is performing regarding cost expectations. CPI is done for a given period of time. CPI = EV/AC

Cumulative CPI: It’s the CPI from the project start time to a particular point in time. CCPI = CEV/CAC

  From: http://sitestree.com/?p=11513
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Post Data:2017-10-17 16:25:44

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May 20

Details on Cost Management Terms. Part – 9: Project Cost Management #PMP – Project Management

Details on Cost Management Terms. Part – 9: Project Cost Management

For now, this is just a place holder post

Earned Value: The value the spent money brought to the project. Just like double entry accounting system: for every debit to an account there is a corresponding credit.

Budgeted at Completion (BAC): How much was originally planned for this project.

Planned Value (PV): Calculates how much of the project should be complete at a certain date according to the plan. Planned Value = Planned%complete*BAC

Earned Value (EV): How much is actually done during a period. EV=Actual%Complete*BAC

  From: http://sitestree.com/?p=11511
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Post Data:2017-10-17 16:23:46

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May 20

Cost Management Terms. Part – 8: Project Cost Management #PMP – Project Management

Cost Management Terms. Part – 8: Project Cost Management

Earned Value: The value the spent money brought to the project. Just like double entry accounting system: for every debit to an account there is a corresponding credit.

Budgeted at Completion (BAC): How much was originally planned for this project.

Planned Value (PV): Calculates how much of the project should be complete at a certain date according to the plan. Planned Value = Planned%complete*BAC

Earned Value (EV): How much is actually done during a period. EV=Actual%Complete*BAC

Actual Cost: Money spent over the period

Cost Variance (CV): Difference between planned cost and actual cost. CV = EV – AC

Schedule Variance (SV): Difference between the planned schedule and actual schedule (as:Where the project is in the schedule). SV=EV-PV

Cost Performance Index (CPI): The rate at which the project cost is performing regarding cost expectations. CPI is done for a given period of time. CPI = EV/AC

Cumulative CPI: It’s the CPI from the project start time to a particular point in time. CCPI = CEV/CAC

Schedule Performance Index (SPI): The rate at which the project is performing in respect of schedule expectations up to a point in time. SPI=EV/PV

Estimate at Completion (EAC): Forecast the total cost at project completion based on the project performance up to a point in time. EAC = BAC/CCPI

Estimate to Completion (ETC): How much more will be spent to complete the project based on past performance.

Variance at Completion (VAC): Difference between what was budgeted and what will actually be spent. VAC = BAC – EAC

Project managers need to calculate these values to get a good understanding of the project cost. He can get answers to questions like: How much is spent? How much more are required? Is the project progress satisfactory in terms of cost? — these will ultimately help in project cost control.

  From: http://sitestree.com/?p=11508
Categories:PMP – Project Management
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Post Data:2017-10-17 16:20:59

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May 20

Cost Control in Details : Part – 7: Project Cost Management #PMP – Project Management

Cost Control in Details : Part – 7: Project Cost Management

(Details will be provided at a later time, so now, in short)

Monitoring, controlling, adjusting costs

When it is performed?
Over the whole life cycle. Bi-weekly or monthly analysis may be done

Tools
Cost Change Control System
How the cost baseline may be changed

Performance Measurement Analysis
Calculate Earned Value, Planned Value, Actual Cost, Estimate to complete, Estimate at Completion, Cost Performance Index and similar to measure performance and control costs based on these

Forecasting
Use current and previous cost values to estimate future costs

Variance Management

Output
Cost Estimate Update
Cost Baseline Update

Performance Measurement Analysis will be discussed later

  From: http://sitestree.com/?p=11506
Categories:PMP – Project Management
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Post Data:2017-10-17 16:18:27

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May 20

Cost Control in Short : Part – 6: Project Cost Management #PMP – Project Management

Cost Control in Short : Part – 6: Project Cost Management

Monitoring, controlling, adjusting costs

When it is performed?
Over the whole life cycle. Bi-weekly or monthly analysis may be done

Tools
Cost Change Control System
How the cost baseline may be changed

Performance Measurement Analysis
Calculate Earned Value, Planned Value, Actual Cost, Estimate to complete, Estimate at Completion, Cost Performance Index and similar to measure performance and control costs based on these

Forecasting
Use current and previous cost values to estimate future costs

Variance Management

Output
Cost Estimate Update
Cost Baseline Update

Performance Measurement Analysis will be discussed later

  From: http://sitestree.com/?p=11504
Categories:PMP – Project Management
Tags:
Post Data:2017-10-17 16:16:46

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May 20

Cost Budgeting in Details. Part – 5: Project Cost Management #PMP – Project Management

Cost Budgeting in Details. Part – 5: Project Cost Management

(Details will be added at a later time)

Maps costs and dates. How much will be spent on what and when. Also termed Cost Baseline

When cost budgeting is done?
After activities are defined and scheduled. Activity durations and resource requirements are also estimated.

Tools
Cost Aggregation
Activity level costs should be aggregated to the work level where they will be measured, managed, and controlled.

Reserve Analysis
Financial reserve to protect projects against cost overrun

Parametric Estimating
Use simple straight forward formulas

Funding Limit Reconciliation
Comply with the project funding. many times funds are allocated even before the scope is defined.

Output
Cost Baseline
Project Funding requirements

  From: http://sitestree.com/?p=11502
Categories:PMP – Project Management
Tags:
Post Data:2017-10-17 16:14:08

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May 20

Cost Budgeting in Short. Part – 4: Project Cost Management #PMP – Project Management

Cost Budgeting in Short. Part – 4: Project Cost Management

Maps costs and dates. How much will be spent on what and when. Also termed Cost Baseline

When cost budgeting is done?
After activities are defined and scheduled. Activity durations and resource requirements are also estimated.

Tools
Cost Aggregation
Activity level costs should be aggregated to the work level where they will be measured, managed, and controlled.

Reserve Analysis
Financial reserve to protect projects against cost overrun

Parametric Estimating
Use simple straight forward formulas

Funding Limit Reconciliation
Comply with the project funding. many times funds are allocated even before the scope is defined.

Output
Cost Baseline
Project Funding requirements

  From: http://sitestree.com/?p=11500
Categories:PMP – Project Management
Tags:
Post Data:2017-10-17 16:11:51

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May 20

Cost Estimation in Details. Part – 3: Project Cost Management #PMP – Project Management

Cost Estimation in Details. Part – 3: Project Cost Management

(Details will be added at a later time, now in short)

Cost Estimation in Short

When cost estimation is done?
After project scope is defined, and work breakdown structure is created.But may be performed again and again over the total life cycle

Tools
Analogous Estimating
Based on the similar actual projects

Bottom up estimating:
Estimate cost for each activity and sum them – time consuming

Parametric Estimating
1 mile road construction needs $400,000$. So 10 miles will require 10*400,000$.

Reserve Analysis
A buffer cost against slippage on the project

Cost of Quality
Costs required in order to get quality

Output
Activity Cost Estimates From: http://sitestree.com/?p=11498
Categories:PMP – Project Management
Tags:
Post Data:2017-10-17 16:08:29

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May 20

Cost Estimation in Short. Part – 2: Project Cost Management #PMP – Project Management

Cost Estimating in Short. Part – 2: Project Cost Management

Cost Estimation in Short

When cost estimation is done?
After project scope is defined, and work breakdown structure is created.But may be performed again and again over the total life cycle

Tools
Analogous Estimating
Based on the similar actual projects

Bottom up estimating:
Estimate cost for each activity and sum them – time consuming

Parametric Estimating
1 mile road construction needs $400,000$. So 10 miles will require 10*400,000$.

Reserve Analysis
A buffer cost against slippage on the project

Cost of Quality
Costs required in order to get quality

Output
Activity Cost Estimates From: http://sitestree.com/?p=11496
Categories:PMP – Project Management
Tags:
Post Data:2017-10-17 16:06:01

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