Cost Control and Change Management
Most projects have a difficult time obtaining accurate and relevant cost information which allows solid performance measurement and forecasting of the estimate-to-complete (ETC). The problem we see repeatedly is that the cost collection process is not consistent with the baseline estimate. This lack of consistency prevents comparing actual expenditures to the estimated expenditures at a level which would allow the identification of variances. As a result, total project expenditures can be tracked, but it becomes very difficult to determine what it is being spent on. High Bridge has developed a structured approach to project cost management which includes the following key components:
- Project budgets are based on a solid foundation as provided by our Scope and Estimate Development Process.
- The project accounting process allows for the utilization of the project work breakdown structure in the cost coding process along with the traditional accounting code of accounts.
- Control accounts are established within the baseline work breakdown structure at a level of detail that is sufficient to measure performance and forecast cost trends but not so detailed as to overwhelm the project organization with unnecessary detail.
- Costs are collected at a level of detail that allows for the analysis of each control account.
- A structured Change Management process is in place which provides for clear documentation of baseline changes with a clearly defined approval process.
- Clear reports providing tabular data, trend data, and quantitative metrics to clearly communicate management objectives and manage performance are routinely published.
- Routine management review meetings are in place and effectively address performance and trends.