Project Control Management
Cost control is a fundamental pillar of project management. Its primary goal is to monitor
whether the projects stay within the assigned budget, maximizing financial resources without
sacrificing quality or timeliness.
Purpose
The goal is to build a practical and professional framework for managing project costs utilizing
the best methodologies and accepted practices.
Scope
The purpose of this document is to define the policies, procedures, and responsible parties for all stages of cost control. These are:
- Definition of base budgets.
- Monitoring and control of expenses.
- Management of deviations.
- Cost reporting and projections.
Key Processes
Cost Planning.
- Budget:
- Validate direct and indirect costs.
- Establish reserves for contingencies and risks.
- Create a budget broken down by project phases.
Risks Identification:
- Detect financial risks and establish mitigation strategies.
- Incorporate identified risks into the base budget.
Cost Surveillance
- Expenses record.
- Categorize expenses.
- Real expenses v/s planned budget.
Variations Analysis:
- Identify significant deviations.
- Evaluate the impact of these deviations on the total budget.
Gestión de Desviaciones
Sugerencia de Acciones Correctivas:
Revisión de medidas correctivas en colaboración con el equipo del proyecto.
Ajustar el presupuesto y los planes de acción según sea necesario.
Aprobaciones:
Presentar las desviaciones y acciones correctivas al cliente para su aprobación.
Costs Report
- Closing projection.
- Develop monthly reports with updated closing cost projections.
- Conclusion and Recommendation State the outcome of your analysis and recommended course of action.
- Progress reports
- Provide a clear view of current costs, reservations used, and changes made.
Benefits of Cost Control
- Financial transparency: Readily available and understandable information about the project’s financial situation and projects.
- Resource efficiencies: efficient use of resources available
- Risk avoidance: avoid adverse financial impacts with proactive analysis.
- Performance standards: projects on budget.
Continuous Evaluation and Improvement
- Documentation of findings and best practices at the end of each project.
- Periodic Review: This involves updating guidelines and methodologies with recent innovations and learnings.
Introduction
Planning is vital before the start and during the execution of any project and is key to success. It provides the action plan to facilitate effective execution. Objectives ensure alignment with client goals, while others contemplate resource optimization and risk mitigation.
Purpose
Establish a structured framework that facilitates the development of master plans, the definition of clear objectives, and the anticipation of potential deviations to ensure comprehensive and effective control throughout the project’s life.
Scope
- This document applies to all project planning activities, including:
- Creating schedules.
- Preparing base budgets.
- Recognizing and controlling risks.
- Scoping deliverables and key performance indicators. .
- Preliminary Schedule.
- List activities/milestones and develop a schedule.
- Use specialized tools such as Primavera P6 or MS Project.
- Identification of potential risks and development of action plans.
- Inclusion of contingencies that are consistent with the project’s complexity.
- Definition of goals.
- Creation of S.M.A.R.T. clear and measurable goals.
- Assignment of responsible members for each goal.
- Develop relevant documents that would serve as operational guidelines for the project team.
- Develop relevant documents that would serve as operational guidelines for the project team.
- Time optimization assures that all activities will be conducted according to the schedule, mitigating delays in achieving goals.
- Better coordination: Clear and structured scheduling leads to better and more efficient integration of all project areas.
- Transparency—Outreach always shows the project’s progress. It helps reveal deviations from the schedule at an early stage of the project.
- Adaptability—The outreach concept allows quick response to possible upcoming changes by simply changing the schedule without undermining the project’s general goal.
- Resource efficiency – Outreach allows resource efficiency conduct due to control over scheduled activities.
- Deadline Compliance: Effective schedule control ensures the completion of activities and deliverables as planned, minimizing the risk of delays, and ensuring the project is completed within client expectations.
- Proactive Deviation Management: This method detects deviations in real time and provides the project leader with the necessary information and tools to quickly correct any action plans and ensure rapid recovery without significant schedule disruptions.
- Visibility and Transparency: Keeps the project leader informed of current progress, including advances and barriers, and holds them accountable for making informed decisions regarding the schedule.
- Resource Optimization: Coordinates and manages available human, material, and financial resources to ensure they are available at the right time and place to move forward as planned.
- Flexibility: Ensures that changing or unforeseen needs are implemented with appropriate adjustments that minimize the impact on the schedule and keep the project aligned with the overall objective.
- Periodic reviews:
- Evaluate the effectiveness of the strategy every quarter.
- Incorporate improvements based on lessons learned.
- Client Feedback:
- Collect feedback at the close of each stage.
- Implement adjustments for future projects.