Name the project cost management processes
Plan cost management
Estimate costs
Determine budget
Control costs
What is plan cost management
The process that establishes the policies, procedures, and documentation for planning, managing, expending, and controlling project costs
Key benefit of plan cost management
It provides guidance and direction on how the project cost will be managed throughout the project
Plan cost management inputs
Project management plan
Project charter
Enterprise environmental factors
Organizational process assets
Plan cost management tools and techniques
Expert judgment
Analytical techniques
Meetings
Plan cost management outputs
Cost management plan
What is estimate cost process
The process of developing an approximation of the monetary resources needed to complete project activities
Estimate costs key benefit
It determines the amount of cost required to complete project work
Estimate costs inputs
Cost management plan Human resource management plan Scope baseline Project schedule Risk register Enterprise environmental factors Organizational process assets
Estimate costs tools and techniques
Expert judgment Analogous estimating Parametric estimating Bottom up estimating Three point estimating Reserve analysis Cost of quality Project management software Vendor bid analysis Group decision-making techniques
Estimate cost outputs
Activity cost estimates
Basis of estimates
Project documents updates
Rough order of magnitude
-25% to 75%
When is analogous estimating used
When there is limited amount of detailed information about the project
What are contingency reserves
The part of the budget intended to address known unknowns. They are part of the cost baseline and overall funding requirements
What are management reserves
The amount of project budget withheld for management control purposes that are intended to address unknown unknowns. They are not included in the cost baseline but are part of the overall project budget and funding requirements
What are activity cost estimates
Quantitative assessments of the probable cost required to complete the project
What is the basis of estimates
Supporting details for activity cost estimates.
Includes
Documentation for basis of the estimate
All assumptions made
Any known constraints
Indication of the range of possible estimates
Indication of confidence level of the estimate
What is the determine budget process
Process of aggravating the estimated cost of individual activities or work packages to establish an authorized cost baseline
Determine budget key benefit
It determines the cost baseline against which the project performance can be monitored and controlled
Determine budget inputs
Cost management plan Scope baseline Activity cost estimates Basis of estimates Project schedule Resource calendars Risk register Agreements Organizational process assets
Determine budget tools and techniques
Cost aggregation Reserve analysis Expert judgment Historical relationships Funding limit reconciliation
Determine budget outputs
Cost baseline
Project funding requirements
Project documents updates
What is the funding limit reconciliation
The measurement of variance between the funding limits in the plant expenditures that necessitates the rescheduling of work to level out the rate of expenditures
What is the cost baseline
The approved version of the time face project budget, excluding any management reserves, which can only be changed or formal change control procedures and is the basis for comparison to actual results
What is the control costs process
Process of monitoring the status of the project update the project costs and managing changes to the cost baseline
Control costs key benefit
Provides the means to recognize variance from the plan in order to take corrective action and minimize risk
Control costs inputs
Project management plan
Project funding requirements
Work performance data
Organizational process assets
Control cost tools and techniques
Earned value management Forecasting To complete performance index (TCPI) Performance reviews Project management software Reserve analysis
Control costs outputs
Work performance information Cost forecasts Change request Project management plan updates Project documents updates Organizational process assets updates
What are project funding requirements
Projected expenditures plus anticipated liabilities
What is earned value management (EVM)
A methodology to combine scope, schedule, and resource measurements to assess project performance and progress
What is planned value
The authorized budget assigned to scheduled work
What is budget at completion (BAC)
The total planned value for the project
What is earned value
A measure of work performed expressed in terms of the budget authorized for that work
What is actual cost
The realize cost incurred for the work performed on an activity during a specific time.
What is schedule variance
A measure of schedule performance expressed as the difference between the earned value and plan value
What is cost variance
The amount of budget deficit or surplus at a given point in time, express is a difference between earned value and actual cost
What is the schedule performance index
A measure of schedule efficiency express is the ratio of earned value to plan the value. Under one is bad greater than one is good
What is cost performance index
A measure of the cost efficiency of budgeted resources, expressed as a ratio of earned value to actual cost. Less than one is bad, greater than one is good
What is the manual EAC method
It builds upon the actual cost and experiencing card for the work completed.
What is the EAC forecast for ET see work performed at the budgeted rate
Actual costs plus the difference between budget at completion minus earned value
What is the EAC forecast for ETC work performed at the present CPI
This method assumes what the product is experience today can be expected into the future. It equals the budget completion divided by the cost performance
What is the EAC forecast for ETC work considering both SPI and CPI factors
This method is the most useful when the project schedule is a factor impacting the E TC effort. It is equal to the actual cost plus the difference between BAC and EV divided by CPI times SPI
What is the to complete performance index (TCPI)
A measure of the cost performance that is required to be achieved with the remaining resources in order to meet a specified management goal, express is the ratio of the cost to finish the outstanding work to the remaining budget
Define project cost management
The processes involved in planning, Estimating, budgeting, financing, funding, managing, and controlling costs so that the project can be completed within the approved budget