Introduction
Project cost management is one area where the changes are very minimal. Hence all changes and highlights are summed up in one page
Trends and Emerging Practices in Project Schedule Management
Earned Schedule is one derivative of EVM that will interest to every Project Management Professional. In traditional EVM schdudle variance is calculated in monetary units using the formula
SV = EV – PV
In Earned schedule theory, the monetary value is relaced with time value and the formula is rewritte as
SV = ES – AT where AT is the duration that correspond to the data date and the ES is schedule intersection correspond to the EV data point. See the below figure.
Actual time (AT) is 7 months and the Earned Schedule (ES) is five months and hence the schedule variance is minus 2 months
And th SPI = ES/AT = 5/7 = 0.7
Where the projects are time sensitive this metric can be calculated as part of project monitoring and control.
Other changes
Plan Cost Management Plan :
Scope and Schedule baselines were the previous inputs. Now they are replaced with Schedule management plan and risk management plan:
Estimate costs
Additional techniques are added (refer table below)
INPUT | T&T | OUTPUT |
Project management plan | Expert judgment | Cost estimates |
Project documents | Analogous estimating | Basis of estimates |
Enterprise Environmental Factors | Parametric estimating | Project documents updates |
Bottom-up estimating | ||
Three-point estimating | ||
Data analysis | ||
Project management information system | ||
Decision making |
Determine budget
In this process business documents are referred so that the budgets are in alignment with customer agreement and the business case. A welcome change!
In T&T part, financing is added to align the funding requirements with cash inflow commitments and constraints. This is program management feature and reflected in project budgeting.
The outputs will have some updates to schedule in the form of delayed activities and revised cost estimates.
INPUT | T&T | OUTPUT |
Project Management plan: | Expert judgment | Cost baseline |
Project documents | Cost aggregation | Project funding requirements |
Business documents | Data analysis | Project documents updates |
Agreements | Historical information review | |
EEF & OPA | Funding limit reconciliation | |
Financing |
Control costs
Minor changes. Performance Measurement baseline is added a fourth baseline in the sixth edition. The same has been echoed here.
[table id=25 /]
Variance analysis and trend analysis are commonly used in cost control. Hence they have been added. The OPA updates is removed as lessons learned, assumptions are recorded in separate documents
Summary / Conclusion
For those who are trained in 5th edition and looking forward to writing exam on sixth edition, this area is easy to adopt.
