Monday, 28 October 2013

Plan Cost Management

Plan Cost Management
Once the project charter charter is received, the project manager builds a PM plan outline. As he does that, he starts building the core of the PM Plan - The core objectives being the scope, time and cost. So, the scope, time and cost management plans are built in an iterative manner - looking up one while building another and filling information in the relevant plans.

As with any plan, these plans will have information about what processes are relevant in the knowledge area for the project and also add any tailoring guidelines for the different documents in the concerned knowledge area. The plan documents leverage prior experience in the organization rather than thinking right from scratch. So, all tools and techniques to leverage experience is utilized by the manager.

The Plan Cost management process deals with coming up with a process to derive the cost baseline, manage cost baseline and changes to the baseline. It also deals with defining process tailoring guidelines for the other processes in this knowledge area based on the project context. It also has details about the estimate like the unit of measure, range, accuracy etc.

Project management Plan: As in case of all other processes and also since planning is an iterative process and project management plan is one of the first documents the project manager starts outlining, the contents in the project management plan are useful in detailing the cost management plan.
Project Charter: Since scope , time and cost are termed triple constraints and they are the first few knowledge areas whose plans are detailed, project charter becomes an important input to take care of risks, assumptions and constraints and also the high-level budget allocated in case of the cost management process.
Enterprise Environmental Factors: As with all planning processes, the effect on project due to external factors becomes an important input for the planning process and that too in case of the planning processes part of triple constraints.
Organizational Process Assets: The templates and prior experience is leveraged to build the cost management plan.

Tools and Techniques:
Expert Judgment: Expert Judgment from experienced managers and consultants is leveraged to create a viable cost management plan.
Analytical Techniques: Analytical techniques like brainstorming, delphi technique become handy in detailing all possible scenarios and building the plan for the same.
Meetings: A lot of time in spent by the project manager in meetings during the planning phase. So, this is an important tool that a manager must utilize.

Cost Mgmt Plan: Has details about how cost will be managed within the provided budget. The plan keeps in mind about other objectives and provides a feasible plan to manage cost. Some of the factors covered in the cost management plan are -
- Units of measure
- Order of magnitude (range)
- Rules and frequency for performance measurement


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