MindMap Gallery PMP-07 Project Cost Management
Chapter 7 Project Cost Management, PMP project management, PMBOK sixth edition knowledge structure organization, (PMBOK 6th Edition) Essential for studying and preparing for exams, 49 process tests, The ten knowledge areas of PMP, the input and output of the five process groups, PMP Exam—Knowledge Points Review (PMBOK Sixth Edition).
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This is a mind map about bacteria, and its main contents include: overview, morphology, types, structure, reproduction, distribution, application, and expansion. The summary is comprehensive and meticulous, suitable as review materials.
This is a mind map about plant asexual reproduction, and its main contents include: concept, spore reproduction, vegetative reproduction, tissue culture, and buds. The summary is comprehensive and meticulous, suitable as review materials.
This is a mind map about the reproductive development of animals, and its main contents include: insects, frogs, birds, sexual reproduction, and asexual reproduction. The summary is comprehensive and meticulous, suitable as review materials.
07 items cost management
Excessive fund balance is a waste of opportunity cost
as per approved budget
by work package
plan according to schedule
Product life cycle cost = project implementation cost, product operating cost, scrap processing cost
Use financial indicators to select projects
payback period
The project construction period plus the cumulative operating profit after the project is put into production, the time required to reach the investment amount
ROI
It refers to the ratio of the average annual operating profit after the project is put into production to the project investment amount. It is necessary to consider the profit during the entire operation period after the project is put into production.
net present value
Refers to the value of a future cash amount today. If the value of 100 yuan one year from now is equal to 99 yuan today, then the present value of 100 yuan is 99 yuan.
The present value of revenue minus the present value of expenditures gives the net present value. Any project with a net present value greater than 0 can be done.
When calculating the net present value, time has been taken into account, so the project duration or investment payback period usually does not need to be considered.
benefit cost ratio
The benefits of the project are divided by the costs. Only projects with a benefit-cost ratio greater than 1 are worth doing.
cost
Direct depreciation method, accelerated depreciation method
direct cost
Intra-project costs, such as personnel salaries
Sunk costs
Costs incurred in the past have nothing to do with future choices
opportunity cost
Choose one over (profit of) the other
When making decisions, opportunity costs should be considered
7.1 planning cost management
Determine how to estimate, budget, manage, monitor and control project costs
output
cost management plan
Describe how project costs will be planned, scheduled and controlled
unit of measurement, precision, accuracy
control threshold
The maximum difference allowed before some action is required, Usually expressed as a percentage deviation from the baseline plan
Report Format The format and frequency of preparation of various cost reports need to be specified
7.2 Estimate cost
The process of making an approximate estimate of the monetary resources required to complete project activities.
output
Cost Estimate
Including costs that may be required to complete the project work and contingency reserves to deal with identified risks, and a quantitative estimate of management reserves to deal with unplanned work
Estimate basis
The amount and type of supporting information required for the cost estimate, and a clear and complete description of how the cost estimate was arrived at
Tools & Techniques
analogy estimation
Use historical data from similar projects, fast
parameter estimation
Use statistical relationships and variable data, such as hours worked and hourly rates
Bottom-up estimation
most accurate
three point estimate
data analysis
Alternatives Analysis
Reserve analysis
quality cost
consistency cost The cost of preventing failure
prevention cost
Evaluation cost
non-conformity cost Processing failure fee
internal failure costs
external failure costs
7.3 Budgeting
Purpose: Develop project cost baselines, and for large projects financing will be used to obtain funding for the project
enter
business documents
financial factors
project files
Project schedule
output
Project funding requirements
Determine total funding requirements and periodic (e.g. quarterly or annual) funding requirements based on cost baseline
cost basis
including contingency reserves, Excludes management reserves
contingency reserve
The project manager has control and can use it to reduce cancellations. cannot be added
management reserve
It can only be used with approval from senior management.
Approved project budget allocated by time period, used as a basis for comparison to actual results
Tools & Techniques
cost summary
Historical information review
Financing
Funding Limit Balance
7.4 Control costs
Purpose: Analyze whether the expenditure of funds matches the work completed
enter
job performance data
Project funding requirements
output
job performance information
Assess implemented deviations against cost baseline
cost forecast
be documented and communicated to relevant parties
change request
After analyzing project performance, change requests may be made to the cost baseline and schedule baseline
Tools & Techniques
Performance index to completion
Earned value management
performance measurement benchmarks
When the scope is determined, seek the comprehensive optimization of cost and schedule
Earned Value Metric
Planned value (PV) = planned workload x planned unit price (progress)planned value
Earned value (EV) = actual workload x planned unit price earned value
Actual cost (AC) = actual workload X actual unit price actual cost
cost performance index (CPI) = Earned Value (EV) / Actual Cost (AC)
Greater than 1, indicating cost savings
Planned unit price/actual unit price
schedule performance index (SPI) = Earned Value (EV) / Planned Value (PV)
Greater than 1, indicating progress is ahead of schedule
actual workload/planned workload
Cost Variance (CV) = Earned Value (EV) – Actual Cost (AC)
Greater than 0, indicating cost savings
Schedule Variance (SV) = Earned Value (EV) / Planned Value (PV)
Greater than 0 means progress is ahead of schedule
budget at completion BAC
Cost baseline, estimated from the beginning
Estimate at Completion EAC
Estimates of the cost to complete the project at various points during execution
Variance at completion = Budget (BAC) - Estimate (EAC)
If it is greater than 0, it means it is within the budget.