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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12
votes
6answers
656 views

What techniques are necessary to convince (upper) management to abandon a project once time has been invested?

I want to convince my manager and (probably) his manager that a project needs to be scrapped and we need to purchase an off-the-shelf solution. Somehow it was recommended that, rather than use a pre-...
10
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7answers
3k views

A project manager should know how much his/her project members earn monthly?

A project budget includes fixed and variable costs. In most cases (especially in weak matrix and pure functional organizations) salaries of project members are variable costs. In order to calculate ...
9
votes
5answers
225 views

Rent total cost prediction

I have a project management course now. One of points of my project requires me to rent a territory, and I need to include its cost in the project's total cost. The first thing I thought was to ...
7
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2answers
27k views

How to calculate / estimate the cost for one man hour?

I want to know what are all the things need to add for one man hour costing. How to calculate / estimate it?
7
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3answers
3k views

Should every WBS item map to a single “charge number”?

Assuming you are running projects where every employee submits their time in a corporate accounting system like SAP or Deltek, should every project always define charge numbers for every WBS item? ...
6
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7answers
1k views

Can we use a electronic Kanban board to track actual time spent?

My title sums up my question pretty well. We're investigating whether we can use a Kanban-based system to manage and track some internal projects and one of our requirements is to track time spent on ...
5
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4answers
3k views

Is it possible to reduce costs by crashing a project?

I'm working on a study assignment, which involves creating a WBS and GANTT chart for a 6-month project. Then I'm supposed expedite one of the tasks by increasing resources to it, thus decreasing the ...
5
votes
2answers
2k views

how to apply the fixed and variable costs on the WBS to estimate the profit?

I have been asked to estimate the profit that could be achieved for a portfolio for IT training courses. I have to estimate the income and the fixed and variable costs and hence the profit. I made ...
5
votes
2answers
149 views

What will be the standard increase of price from a Time and Material to a Fixed Price?

Knowing there are pros and cons for each type of procurement contracts. I am trying to find the real price % increase from a time and material contract with specific scope to a fixed price. As an ...
4
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9answers
5k views

Should a project Manager include his own cost when costing a project?

Should a project Manager include his own cost when costing a project? I have included the cost of resources I have hired to work on the project, but should I include my own cost to the business in the ...
4
votes
4answers
249 views

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 ...
4
votes
1answer
511 views

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 ...
4
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3answers
193 views

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 ...
4
votes
1answer
69 views

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?
4
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1answer
116 views

Project Planning For Merchant-based Software

I'm quite new to project management. I have a software project in mind and would like to manage it the correct way. The app basically allows movie theater owners to announce their upcoming movies, ...
3
votes
4answers
543 views

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,...
3
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4answers
884 views

How can I prove on paper that we need more resources for our team?

The higher management in most places seems to have a pigheaded tendency to avoid hiring more resources at all costs. The company has been growing in the last few years and a lot more functionality has ...
3
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2answers
237 views

Developing a digital strategy

I work in Australia for one of the world's largest companies. Our marketing team has a large budget for IT (information technology) projects but has very little direction or guidance in the way that ...
3
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1answer
292 views

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 ...
3
votes
6answers
191 views

What lessons in budgeting a project a PM should remember? [closed]

In budgeting cost of the overall project, what should the PM remember? What are the do's & don't s when dealing with the budget of the project?
3
votes
2answers
119 views

How can an EV be calculated when there are different versions of a project plan?

There is a project manager who is trying to come up with a way to calculate EV under a specific situation where there is a project management system which allows different versions of project plans. ...
3
votes
2answers
479 views

Cost of resources in virtual environments

In planning hardware costs, considering the distribution of the product in virtual/cloud environments, where the cost is derived from the use of resources, considering the following points: The ...
3
votes
1answer
84 views

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 ...
3
votes
2answers
855 views

Microsoft Project - View Resource Cost for a Specific Timeframe

Using Microsoft Project 2010, how do I view how much a resource costs the project between a specific time period? For example, I want to view how much the "HR" resource cost the project between ...
2
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2answers
2k views

The meaning of & Calculating Project Budget

I'm very new to the whole Project Management world, so this question may be at the beginners level, anywho: What is the Budget Cost compared to the full Cost of the Project?, based on the research I ...
2
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4answers
113 views

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 ...
2
votes
2answers
334 views

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, ...
2
votes
1answer
164 views

Estimated costs

Should I consider a margin calculating work hours, then increase the final cost, based on estimated hours + margin hours? Or should I add a margin after the estimated hours of work, increasing the ...
2
votes
1answer
60 views

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 ...
2
votes
1answer
391 views

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 ...
2
votes
2answers
52 views

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 ...
2
votes
1answer
107 views

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 ...
2
votes
2answers
391 views

Queuing theory for measuring “change” delivery?

In his presentation "Adopting Continuous Delivery" (http://www.infoq.com/presentations/Adopting-Continuous-Delivery), Jez Humble mentions (~6:50) that queuing theory proves that optimizing for ...
2
votes
2answers
465 views

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 ...
1
vote
2answers
1k views

Difference between “Earned Value” and “Contribution Margin”?

I have been searching here and there for the meanings of "Earned Value" and "Contribution Margin", it doesn't seem to make sense to me why so many project could have a positive(+) Contribution Margin, ...
1
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2answers
69 views

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 ...
1
vote
1answer
54 views

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 ...
1
vote
1answer
108 views

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....
1
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2answers
65 views

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 ...
1
vote
2answers
4k views

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 ...
1
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3answers
74 views

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 ...
1
vote
2answers
1k views

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 ...
1
vote
1answer
3k views

Formula for calculating cost over a certain time period

How can I calculate the cost of a project over a given amount of time. For example: Solution 1: cost 30k setup and 3k/month for as long as we have the service. Solution 2: cost 40k setup and 2k/...
1
vote
2answers
249 views

How to estimate cost to remove bug?

Couple of month before I committed one project to remove bug from that software, that project is not developed according to customer requirements. So, I have included some advanced function according ...
1
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2answers
1k views

Microsoft Project: How to represent salaried employees?

I can't figure out how to represent salaried employees in Microsoft Project. I created a 24 month schedule, and assigned a $100/year resource to a 12-month task. I ran into two problems: I expected ...
1
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1answer
317 views

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 ...
1
vote
1answer
308 views

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 ...
1
vote
1answer
98 views

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 ...
1
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4answers
2k views

Factors to consider for Merging two or more IT Operations team into ONE

I believe this question falls under a Project from the Management side. But I would appreciate any help or resources for the scenario. The project as an IT Manager, is responsible for merging ...
1
vote
1answer
68 views

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 ...