A Comprehensive Beginners Guide To Cost Planning
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The document is a comprehensive beginner's guide on cost planning in project management, outlining key steps such as creating a scope statement, developing a work breakdown structure (WBS), identifying activities, and estimating costs. It emphasizes the importance of estimating activity resources and durations to develop a project schedule and budget. Additional resources for scope and time planning are also referenced throughout the document.
A Comprehensive Beginners Guide To Cost Planning
- 1. Cost Planning A Comprehensive Beginners Guide 1 Designed and Developed by https://www.pmbypm.com | Copyright 2018
- 2. • Create Scope Statement • Create WBS • Identify Work Package Scope Planning •Decompose Work Packages •Identify activities •Estimate Activity Resources •Estimate Activity Duration •Develop Schedule Time Planning • Activity Cost Estimation • Determine Budget Cost Planning 2 Designed and Developed by https://www.pmbypm.com | Copyright 2018
- 3. • Create Scope Statement • Create WBS • Identify Work Package Scope Planning •Decompose Work Packages •Identify activities •Estimate Activity Resources •Estimate Activity Duration •Develop Schedule Time Planning • Activity Cost Estimation • Determine Budget Cost Planning 3 Designed and Developed by https://www.pmbypm.com | Copyright 2018
- 4. Scope Planning For more details about Scope Planning, refer to – https://www.slideshare.net/pmalik2/ignore-project-scope-wbs-at-your-own-peril- 84976876 4 Designed and Developed by https://www.pmbypm.com | Copyright 2018
- 5. 5 Designed and Developed by https://www.pmbypm.com | Copyright 2018 Cost Baseline Project ComponentProject Component Contingency Reserves Project Work Package A Work Package B Work Package C Create WBS
- 6. • Create Scope Statement • Create WBS • Identify Work Package Scope Planning •Decompose Work Packages •Identify activities •Estimate Activity Resources •Estimate Activity Duration •Develop Schedule Time Planning • Activity Cost Estimation • Determine Budget Cost Planning 6 Designed and Developed by https://www.pmbypm.com | Copyright 2018
- 7. Time Planning https://www.slideshare.net/pmalik2/5-steps-of-project-scheduling-process-for- absolute-beginners-86265406 https://www.slideshare.net/pmalik2/how-project-network-diagrams-can-help-you- become-a-better-project-manager https://www.slideshare.net/pmalik2/4-project-estimation-techniques-that-can- make-you-super-successful https://www.slideshare.net/pmalik2/successful-project-managers-use-these-5- ways-to-represent-project-schedule 7 Designed and Developed by https://www.pmbypm.com | Copyright 2018 For more details about Time Planning, refer to –
- 8. Time Planning STEP 1 – Identify Activities by Decomposing Work Packages STEP 2 – Develop Schedule After Sequencing and Estimation 8 Designed and Developed by https://www.pmbypm.com | Copyright 2018
- 9. 9 Designed and Developed by https://www.pmbypm.com | Copyright 2018 Cost Baseline Project ComponentProject Component Contingency Reserves Project Work Package A Work Package B Work Package C Activity 2Activity 1 Activity 3 Activity 4 STEP 1 – Identify Activities
- 10. 10 Designed and Developed by https://www.pmbypm.com | Copyright 2018 STEP 2 – Develop Schedule
- 11. • Create Scope Statement • Create WBS • Identify Work Package Scope Planning •Decompose Work Packages •Identify activities •Estimate Activity Resources •Estimate Activity Duration •Develop Schedule Time Planning • Activity Cost Estimation • Determine Budget Cost Planning 11 Designed and Developed by https://www.pmbypm.com | Copyright 2018
- 12. Activity Cost Estimation Estimate Activity Costs Include Resource Cost and Vendor Costs Include Direct Costs and Indirect Costs Add Activity Reserves 12 Designed and Developed by https://www.pmbypm.com | Copyright 2018
- 13. Designed and Developed by https://www.pmbypm.com | Copyright 2018 13 Cost Baseline Project ComponentProject Component Contingency Reserves Project Work Package A Work Package B Work Package C Activity B $750 Activity A $1800 Activity C $900 Activity D $1550 Estimate Activity Costs
- 14. Determine Budget STEP 1 – Determine WP Cost by Aggregating Costs of Activities STEP 2 – Determine Total Project Cost by Aggregating WP Costs STEP 3 – Estimate Project Contingency Reserves STEP 4 – Add Contingency Reserves to Project Cost to determine Cost Baseline STEP 5 – Optimize Project Schedule & Develop Time Phased Project Budget 14 Designed and Developed by https://www.pmbypm.com | Copyright 2018
- 15. Designed and Developed by https://www.pmbypm.com | Copyright 2018 15 Cost Baseline Project ComponentProject Component Contingency Reserves Project Work Package A $3200 Work Package B $5000 Work Package C $1800 Activity B $750 Activity A $1800 Activity C $900 Activity D $1550 STEP 1 – Aggregate Activities Cost
- 16. Designed and Developed by https://www.pmbypm.com | Copyright 2018 16 Cost Baseline Project ComponentProject Component Contingency Reserves Project $9000 Work Package A $3200 Work Package B $5000 Work Package C $1800 Activity B $750 Activity A $1800 Activity C $900 Activity D $1550 STEP 2 – Aggregate WP Cost
- 17. Designed and Developed by https://www.pmbypm.com | Copyright 2018 17 Cost Baseline Project ComponentProject Component Contingency Reserves $1000 Project $9000 Work Package A $3200 Work Package B $5000 Work Package C $1800 Activity B $750 Activity A $1800 Activity C $900 Activity D $1550 STEP 3 - Estimate Contingency Reserves
- 18. STEP 4 - Cost Baseline = Project Cost + Contingency Reserves Designed and Developed by https://www.pmbypm.com | Copyright 2018 18 Cost Baseline $10000 Project ComponentProject Component Contingency Reserves $1000 Project $9000 Work Package A $3200 Work Package B $5000 Work Package C $1800 Activity B $750 Activity A $1800 Activity C $900 Activity D $1550
- 19. STEP 5 - Time Phased Cost Baseline Designed and Developed by https://www.pmbypm.com | Copyright 2018 19 Cost Baseline CumulativeCost Time
- 20. YOUR OPINION IS IMPORTANT TO US For Any Questions Or Suggestions Contact Us @ https://www.pmbypm.com/contact-praveen-malik/ Designed and Developed by https://www.pmbypm.com | Copyright 2018 20