Project Cost Management ·

Project Cost Management
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A project is not like typical operations which earn money for the organization, during the life of a project. Projects are funded by a sponsor based on the benefits which he perceives. A project exists to create a unique product, service, or results. This output of the project is useful only after the project is complete and the project output (product, service, or result) is handed over to the user. In a long-term project getting needed funding throughout the project lifecycle (PLC) is extremely important for project success. Therefore it necessary for a project manager to understand

Overall how much money is required for the project
How much money is required for what deliverable and activity
At what point of time money is required in PLC
Who is funding the project?
Why are they funding this project? What output do they expect?
How to convince the sponsor that the value of deliverables is as per the plan?
How to convince the customer, user, manager that there is a cost involved in incorporating a change therefore change should be funded?
Establish funding requirements.
Tracks cost of incorporating changes against the plan.
Separately manage funds required to manage risk.
Establish cost tracking and reporting systems.
Understand risk tolerance and risk appetite of stakeholders, so that estimation can consider that input.
What are the different types of costs, which a project should estimate, baseline, track and report?
How and who will estimate the cost?

There are different Contract Types and based on the contract performance money is released by the sponsor as per the contract. A project also needs to purchase different kinds of products, services, or results from different vendors. So, different kinds of contracts are signed with vendors. Based on the vendor’s contract performance project also need to pay to the vendors.

To manage all these aspects of cost in the project there are 4 processes in this knowledge area

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Dr. Hari Thapliyaal

Dr. Hari Thapliyal is a seasoned professional and prolific blogger with a multifaceted background that spans the realms of Data Science, Project Management, and Advait-Vedanta Philosophy. Holding a Doctorate in AI/NLP from SSBM (Geneva, Switzerland), Hari has earned Master's degrees in Computers, Business Management, Data Science, and Economics, reflecting his dedication to continuous learning and a diverse skill set. With over three decades of experience in management and leadership, Hari has proven expertise in training, consulting, and coaching within the technology sector. His extensive 16+ years in all phases of software product development are complemented by a decade-long focus on course design, training, coaching, and consulting in Project Management. In the dynamic field of Data Science, Hari stands out with more than three years of hands-on experience in software development, training course development, training, and mentoring professionals. His areas of specialization include Data Science, AI, Computer Vision, NLP, complex machine learning algorithms, statistical modeling, pattern identification, and extraction of valuable insights. Hari's professional journey showcases his diverse experience in planning and executing multiple types of projects. He excels in driving stakeholders to identify and resolve business problems, consistently delivering excellent results. Beyond the professional sphere, Hari finds solace in long meditation, often seeking secluded places or immersing himself in the embrace of nature.

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