Project Management

SUMMARY: Costs do not occur, they are incurred. Failure to control costs has led to the failure of several projects. The process of cost management is done in four steps: resource planning cost estimating, cost budgeting and cost control. Resource planning identifies all the resources that the project requires.

The project manager consider various alternatives and seeks the opinions of experts to plan for these resources. To estimate the costs, the project manager uses techniques like analogous estimating, parametric modeling, bottom-up estimating and certain computerized tools. The cost change control system describes the procedures in controlling the costs

Projects generally incur more costs than planned. These extra costs are called cost overruns.