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Striking the
Balance on CostPROJECT COST MANAGEMENT: A CASE STUDY
- CAANGAY, Ian – CAPARIDA, Harold -
DEFINITION
PROJECT MANAGEMENT
Application of knowledge, skills,
tools and techniques to project
activities to meet project
requirements
[A Guide to the Project Management Body of Knowledge (PMBOK Guide)
2000 Edition]
2
ABOUT PROJECT COST MANAGEMENT
Allotment of limited monetary and
physical resources to complete the
project
“how much will it cost the performing
organization to provide the product or
service involved?”
3
MAJOR PROCESSES
Resource Planning
Cost Estimate
Cost Budget
Cost Control
4
SITUATION
XYZ Studios
Software development company
specializing in:
mobile applications
Web-based systems
Database management
Software branding
5
SITUATION
Project Manager tasks:
Formal meeting with clients
Define scope and goals
Prepares resource plan
6
SITUATION
Development process
Agile methodology
“respond to unpredictability thru
incremental, iterative work cadences
and empirical feedback”
[The Agile Movement – www.agilemthodology.org]
7
SITUATION
The Project
8-month deal to develop a
scheduling and booking system
(for a network of massage & therapeutic clinic)
Estimated P800,000 cost for
development, divided every month of
the project
8
ISSUES AND CHALLENGES
Resource Plan include:
Work breakdown structure
Timeline for tasks
Member assignment
Cost definition for project phase?
9
ISSUES AND CHALLENGES
Downside of Agile methodology
Constant communication with client lead to added/modified features
Deviation from original scope
Unable to progress if modification is undone
Cost on time, manpower, materials?
10
ISSUES AND CHALLENGES
Tradeoffs
Stretch timeline: increased cost,
diminish revenues
Weigh-in on cost: invest much or risk
quality of product/service
11