Questions tagged [cost-management]
Cost Management is an organizational methodology by which a company controls and plans the costs of doing business.
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Variable costs per unit appears higher than total costs per unit
Trying to solve imagined situation. Have highest and lowest sales quantity and have personnel expenses that are mixed expenses (part is fixed wages; part variable wages - amount depends on sales ...
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Getting correct value of Planned value for Earned Value Management calculations
I'm learning about project management and currently having confusion about getting Planned Value(PV) in Earned Value Management calculations. Here's the question,
You are a Project Manager for LAK ...
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Should management reserve be a part of profit calculation ? Your experience
I work for a software consulting company. When we estimate fixed-price projects we usually have a cost baseline estimate (cost estimate + contingency reserve) and then based on this we can come up ...
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Don't we need dummy activities in this kind of network diagram?
I haven't seen people using dummy activities in this type of diagram. Is it true that they don't need dummy activities? What is the logic?
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Lately discovered requirements in Scrum
If a requirement is discovered in the middle of a project or even later, then the cost of implementation of this requirement can be very high.
The Scrum suggets that we should only refine the top PBIs ...
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What if a client doesn't accept/agree with a change request?
Let's suppose that a client asks for a change or some additional functionality, but doesn't accept/agree that it is a change request (and that, as consequence, the schedule, the cost must be revised)? ...
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Launching average mobile app on-time vs delayed launch with high-quality app
Apologies if this is the wrong exchange forum, it felt most appropriate to ask this here.
TL;DR What are the pros/cons of a (mobile) app (in the social media space) being launched on-time with an ...
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How to ask a developer for the cost of building my website?
I want to hire a developer to build my custom website application (browser based), but I don't know how and what to ask to determine budget requirements. Is there a 'blueprint' or suggested method ...
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Planned / earned value for items outside of the project scope?
Getting my head wrapped around the PMP / PMI earned value methodology. Traditionally have tracked a project budget vs the actual spend on a simple basis with that being the variance etc.
The scenario ...
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Pricing risks when developing a project's budget
During the initiation and planning a project how much do we add to the project's budget in order to take into account discovered risks? And how much should we raise the price of the project for a ...
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Financial indicators of a project and a project manager's efficiency
A project manager's responsibility is to lead a project to a successful completion, which includes finishing the project on time, a happy customer, a proud team, etc. But it also includes financial ...
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How to estimate amount of work/man hours for an unfamiliar task? This project is fixed bid project from customer
How to estimate amount of work/man hours for an unfamiliar task? This project is fixed bid project from customer. And most of our project is fixed bid project, for the past 3 - 4 project we are ...
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How does inflation affect the cost software making?
I am doing research to know the effect of inflation in software making. How does inflation affect the cost of software production? For example, you are following a waterfall model. Does inflation ...
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How to calculate ROI of a necessary feature to an existing sytem?
I have a business system that works well and is currently in maintenance mode, using up maybe 5% annually of its original cost. So if it was 1,000 hours of development early on, annually we work on it ...
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Who pays for the development/maintenance of the components/framework?
We use components and frameworks for the development of our projects. We have third-party components/frameworks (both - closed and open source) and inherited elements on top of them. Sometimes our ...
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Can our company avoid losses due to sunk cost negotiation?
I feel my company is losing a lot of money on each project iteration because of a negotiation technique employed by our business partners(customers). I want to find out the name of this technique and ...
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Which are top three metrics one should look at as PM specially from IT industry perspective [closed]
I know its very subjective question, however in general I wanted to understand which are the top three metrics as PM, I should look at while working in a Software project
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What to do when no more financing is available for a project in PMI
I wonder what would be the formal procedure and step according to PMI when you realize that your project ran out of money and no more financing from client is available?
I think no other alternative ...
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RFI response form asks for "Assumptions" as just a single money amount
I am surprised by the last row in this RFI response form:
My project's initial fees are 1m$, recurring fees are 100k$/year, under the assumption that I provide only the software and they run it on ...
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When we are calculating the cost for implementing a new web application, should we have separate cost for providing the source code to the client [closed]
I am working on a new asp.net core MVC web application as an out sourced senior software developer/architecture. now i did many requirements gathering sessions with the client, and i came our with a ...
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What can I do when I can't adjust scope, resources, or schedule and a team member wants a raise?
After almost 20y programming and 5y managing I have arrived at a state to be so confused with the basics that I need help from outside!
At the project management we have 3 pillars:
Scope: features ...
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Is money for reward and recognition set aside by PM during Cost Planning?
One of the tools and technique as part of "Develop team" process is to give reward and recognition to the people/team for showcasing desirable behavior during project execution. This is done because ...
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How to Handle a Funding Overrun on a Time and Materials (T&M) Contract
Here is the scenario: You are the PM of a new T&M contract that has a $800,000 budget at completion (BAC) and a price of $1,000,000 and a one-year period of performance (POP). Scope is fluid, ...
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Should I calculate ROI as Benefits/Costs or Gains-Investment/Investment? Which is rather correct?
I am kind of puzzled as various sources give either of those formulas to calculate ROI:
Cost of Benefits /Cost of Investments
or
(Gains - Investment) / Investment
The obvious problem that if I ...
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How can we know that implementing SAFe results in profits for the company?
Did any company measure profits after implementing SAFe?
How can we know that total costs of implementing SAFe are less than profits?
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How to represent an iterative sprint within your schedule list
In an agile approach we can use tools like kanban to plan, measure and monitor sprints. But when we need to use schedule systems like MS Project or any other online collaboration tool that works like ...
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Under what circumstances should a software vendor be allowed to increase charges due to unforeseen complexity?
Something that occurs quite often in outsourced software projects is the vendor underestimates the complexity or learning curve associated with an agreed-upon statement of work, and wants to increase ...
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Is cost management part of Project Management?
Is Cost Management (Estimation and Control) part of Project Mangement?
Are cost management techniques (COCOMO, Function Point, etc) part of PM? Or only Software Project Management?
I ask this ...
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How to communicate/word cost ranges?
When you display cost estimates, when it comes to ranges, what words do you use to convey: Lower End of the Range, and higher End of the range.
The terms I chose (Min/Max) were not liked , so I was ...
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What is 'overhead' in a research project budget?
I am a new to project management, and I have started working on a European project proposal.
I can't figure out what "overhead" actually is. Can anyone explain to me, or provide me with sources from ...
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Project costing & preparation
I have a client who has an "idea" of his project "that is in his mind". He said he is not going to share any details, knowledge, and ideas until we have a contract because as he's saying "he's worried ...
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Cost management without time tracking in Scrum
In my company I'm responsible for several software development teams. Lately our managers asked me to establish a time tracking system for our developers to have better overview over the actual costs ...
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How do I calculate a project management fee on my design projects?
I run a small business and I have to take on an additional resource to handle an increased workload from one of my clients. How do I calculate my project management fee?
I estimate I will spend about ...
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What are differences between Cost Plus Award Fee and Cost Plus Incentive Fee Contract?
Both Cost Plus Award Fee and Cost Plus Incentive Fee contract types are Cost Reimbursable contracts in which the seller is reimbursed for completed work plus a fee representing profit.
In the PMBOK ...
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MS Project 2013 cost adjustment
I would like to know what is the best way to handle cost adjustment to the baseline in MS project. Do you save the baseline when you adjust the cost when you get new estimate or not?
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How can I add a rented resource to MS Project?
I need to create a new resource that include a pay per day and quantity parameters.
For example, I have a resource "Rented Car - Type 1" with 60€/Day as daily cost.
In my project, I have a task (10 ...
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How to finance non-programming activities when clients don't want to pay for these activities?
On one hand, software development involves a lot of non-programming activities like requirements gathering (including analysis), estimating, planning, testing, tracking work, change request management,...
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Is COCOMO 2 Estimation Sound, or is there Something Better?
I am reading about COMOMO estimation and what I see is margin of error is almost always too high. Also I didn't like the idea to use lines of code to measure progress. So I wonder is COMOMO really a ...
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How to manage cost of change / impact analysis with no funding?
The PMBOK® Guide recommends that when a scope change request is submitted, an impact analysis is performed to assess how the change could affect the overall project. How does this work affect the ...
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ETC calculation including SPI
PMBok (page 221) mentions two formulas for estimation ETC based on previous project performance. These are:
(1) ETC = (BAC-EV) / CPI
(2) ETC = (BAC-EV) / (CPI * SPI)
While (1) is completly clear ...
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How does the public sector estimate the cost of large-scale infrastructure projects?
Using the example of the proposed Donald Trump Mexico-USA Border Wall; various figures for the estimated cost have ranged considerably.
Mr Trump claims the total cost of the wall will be $10bn (£7....
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Earned value management with ressources of type "Cost"
I'm working on project management with the client-side manager. We manage the cost with cost type ressources as we only know how much we are going to pay for each task and not how many hours of work ...
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Overheads calculation assumptions
I was wondering if there is any standard or basis by which to consider overhead costs in a project. Normally we practice 10-15%, but I wanted to know what others are following and what's the best ...
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In Scrum, should we be billed for defects and unplanned activities?
My company is the client. An offshore company is developing our product. We pay them on a monthly basis. They send us an invoice with a fixed rate per full time resource. They also send us a ...
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Can I add columns in MS Project Pro to display time-phased costs?
Can I add columns in MS Project Pro to display time-phased costs? I would like to see a cost column for each year of the project. The year-column would only include costs for that year. I can almost ...
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Governance cost as percentage of FTEs
In an Outsourcing IT project we are are trying to estimate the relationship between the governance cost and the project size in FTE.
For example, if the governance cost of a 500 FTEs project is X ...
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Agile and increased costs
The digital function of the organization is attempting to adopt the agile methodology and this is causing an issue with the perceived increased in costs when due diligence is performed on the initial ...
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Indirect cost calculation
As shown in the picture below, my task is to calculate direct and indirect costs using this table at first. Further I have to do the calculation according to Direct costing, Standard costing and ABC ...
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S-Curve in Cost Management
I learned in class that the cost management on a project could be graphed as an S-Curve.
Low in the beginning but then very high and stays high.
Do you have an idea why the graph stays high even ...
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How to calculate Present Value and Net Present Value?
I´m doing a feasibility study to check the benefits of an investment in a certain tool. My table shows the savings and the costs in the project over 4 years. So, I´m trying to understand how to apply ...
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