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]

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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?”

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MAJOR PROCESSES

Resource Planning

Cost Estimate

Cost Budget

Cost Control

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SITUATION

XYZ Studios

Software development company

specializing in:

mobile applications

Web-based systems

Database management

Software branding

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SITUATION

Project Manager tasks:

Formal meeting with clients

Define scope and goals

Prepares resource plan

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SITUATION

Development process

Agile methodology

“respond to unpredictability thru

incremental, iterative work cadences

and empirical feedback”

[The Agile Movement – www.agilemthodology.org]

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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

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ISSUES AND CHALLENGES

Resource Plan include:

Work breakdown structure

Timeline for tasks

Member assignment

Cost definition for project phase?

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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?

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ISSUES AND CHALLENGES

Tradeoffs

Stretch timeline: increased cost,

diminish revenues

Weigh-in on cost: invest much or risk

quality of product/service

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