As a project manager, it is very crucial to always looking forward to ways of upgrading yourselves. You must always be eager to learn new things. Employers will only even consider hiring you if you have something to offer to them. Always make sure ‘that something’ is something that is profitable for the organization.
As a project manager, it is vital to know cost management. Almost all the projects have a certain price limit to them. If you go beyond the set budget it might not be good and it also makes the employer question your project management skills. Let us discuss a little about Project Cost management here. If you wish to learn more in detail about project management you may refer to PMP certification classes.
WHAT IS PROJECT MANAGEMENT COST?
The activities involved in planning, estimating, budgeting, financing, funding, managing, and controlling expenses so that the project can be finished within the allocated budget are referred to as project cost management.
The following are the project cost management processes:
a. Plan cost management
The procedure for estimating, budgeting, managing, monitoring, and controlling the project expenses.
b. Estimate costs
The procedure for estimating the financial resources required to execute project work.
c. Determine budget
To develop an allowed cost baseline, the process of aggregating the anticipated costs of different activities or work packages.
d. Control costs
The practice of keeping track of the project's progress in order to update project costs and manage changes to the cost baseline.
In the PMBOK® Guide, the Project Cost Management procedures are presented as discrete processes with specified interfaces, but in practice, they overlap and interact in ways that the PMBOK® Guide cannot fully specify. These processes interact with one another as well as other Knowledge Area processes.
Cost estimating and cost budgeting are closely linked on some projects, particularly those with a smaller scope, and can be considered as a single process that can be completed by a single person in a short period of time. Because the tools and approaches for each are different, they are described as separate processes here.
KEY CONCEPTS FOR PROJECT COST MANAGEMENT
The cost of the resources required to perform project operations is the primary focus of project cost management. Project Cost Management should take into account the impact of project decisions on the ongoing costs of using, maintaining, and supporting the project's product, service, or outcome. Limiting the amount of design reviews, for example, can save project expenses but raise the running costs of the final product.
Recognizing that various stakeholders measure project costs in different ways and at different periods is another facet of cost management.
If you are a project manager looking to get PMP certified, go for PMP certification classes.
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