Project Cost Management is a popular topic. Not because people enjoy it, though. Mostly because people don’t know how to do it. And it’s not part of many Project Management training courses.
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My father was a Shopkeeper and was always cautious with money. And that rubbed off on me. So, I found speaking and writing about project cost management difficult because I find cost management so… obvious. Not easy: I know there are a lot of sophisticated tools. But I do it almost by instinct.
I kind of figured it out for myself.
And, as a practicing PM, back in the 1990s and the early 2000s, I had pretty poor tools to work with. My firm’s Management Information System (MIS) was poor for project cost control. This was despite the firm being accountancy-based, and organized to deliver projects.
I know they changed the system shortly after I left. But as a result, I have never worked with a sophisticated Project Management Information System. (PMIS – careful how you say it).
In fact, when I was managing project costs, I resorted to creating my own spreadsheets. And these were multi-million-dollar projects!
I took a lot of time learning how budgets and cash flows work, and how to build robust spreadsheets. I also spent time with those spreadsheets, to get a deep understanding of the numbers and what they meant.
This was time well spent. My bosses and my clients took a profound interest in Project costs. And nothing pushes cost management up your priority list better than strict oversight.
As a project manager, I had two sets of performance measures against which I was primarily judged:
Getting good at cost management was a matter of self-preservation!
Carefully curated video recommendations for you:
I asked Project Managers in a couple of forums what material things you need to have, to do your job as a Project Manager. They responded magnificently. I compiled their answers into a Kit list. I added my own.
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Dr Mike Clayton is one of the most successful and in-demand project management trainers in the UK. He is author of 14 best-selling books, including four about project management. He is also a prolific blogger and contributor to ProjectManager.com and Project, the journal of the Association for Project Management. Between 1990 and 2002, Mike was a successful project manager, leading large project teams and delivering complex projects. In 2016, Mike launched OnlinePMCourses.
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