Control Costs Process

Sometimes in life, we want to see if things go the way we planned. And sometimes we have to be sure of that. In projects, it is also necessary to monitor the current state and course of project costs, update when the presence of situations that are not going well and the need for correction is detected, and manage deviations by comparing the current situation with the cost baseline.

Like other critical project processes, cost-related processes are subject to certain risks that can have critical consequences. We resort to corrective measures to minimize and control these risks. The control cost process is the process by which we identify the need for this corrective action.

During this process, the financial status of the project is monitored and updates to the project budget are made when necessary. When deviations from the cost baseline are detected, the causes of these deviations are investigated and appropriate solutions are sought.

In this direction, data is provided to integrated change control processes by creating change requests. By monitoring the performance of the budget, relevant stakeholders are informed of current events and changes occurring in all matters within the cost management information area.

Control costs process is a part of monitoring and controlling process group and cost management knowledge area. It is implemented continuously throughout the project.

Inputs used in control costs process

  • Lessons learned register : This is a handy input as always as it shows information about former issues about cost.
  • Project funding requirements: It is the the total and periodic funding requirements for the project. It may effect the cost performance, so it is an input.
  • Work performance data: This data will be processed as a part of the process and work performance information will be created.
  • Cost management plan: Guides us about the methodology, tresholds and roles and responsibilities.
  • Cost baseline: We will compare actual performance of the project with the cost baseline.
  • Performance measurement baseline: Similar with cost baseline it will be used for comparison.
  • Organizational process assets: Cost control tools of the organization, monitoring and control procedures and existing policies are examples of OPA.

Tools & Techniques of Control Costs

  • Earned value analysis : It is a data analysis technique used for measuring the performance of the project. Using this tool is an essential part of the control costs process.
  • Expert judgment: Budgeting experts, finance experts, controllers, people with former experience are welcome to share their judgments.
  • Project management information system: Costs are generally tracked by using a software which is a part of PMIS.
  • Reserve analysis: All projects have risks identified and unknown. As these risk responses will necessitate a cost to expend, a reserve money should be set for the project.
  • To-complete performance index: It shows what remained to complete the process. Therefore it shows the current performance of the project.
  • Trend analysis: It is used to forecast the future cost performance of the project by using past results gained so far.
  • Variance analysis: Simply shows us the difference between planned performance and actual performance of the project.

Outputs of Control Costs

  • Work performance information: Like many other control processes it is an output of control costs process as well.
  • Cost forecasts: We can have a forecast avout the future performance of the project in terms of cost by using the tools and techniques mentioned above.
  • Change requests: If we catch points that are not on the line, we may decide to prepare change requests.