By Ryan Burke, PMP, RMP
The importance of cost monitoring within a project cannot be overstated. In a recent GAO audit of a Government Agency from June of 2018, a common theme was identified in the form of improperly estimated project cost, or not properly tracking cost performance throughout the lifecycle of the project. As the projects mentioned in this audit moved through their lifecycle, elevated costs and schedule delays became a common theme. If proper earned value management was incorporated into the overall management of these projects, these delays and overruns may have been avoided.
One area frequently mentioned in the GAO document was the lack of accurate cost estimation early on in the project necessary to develop a baseline. In the early stages of a project, an accurate baseline of the cost will make or break your project. This estimate can be accomplished by leveraging a host of tools such as independent estimates, costs from similar projects, subject matter expertise, work breakdown structure, and other various estimating methods. If multiple methods are used to determine a cost estimate, the chance of an accurate figure is greatly improved. Throughout the lifecycle of the project, this baseline cost should be continuously reviewed and monitored to ensure that the project stays on time and on budget.
In addition to an accurate cost estimate to begin the project, continuous earned value management throughout the lifecycle of the project will go a long way in ensuring that you meet milestones while remaining within your budget. Multiple earned value and risk management tools are available to track project performance and should be done continuously throughout the project lifecycle. If done appropriately, a project manager should greatly increase the ability of achieving project goals and objectives.
To learn more about the Evans human-centered approach to earned value management and risk management, visit us at EvansIncorporated.com and be sure to fill out our contact form to learn more about our services.