2.2 El proceso de valoración económica de la diversidad
2.2.3 Análisis y priorización de los servicios ecosistémicos a ser
Chapter 7 – Project Cost
Management
• Cost Estimating Inputs:
– Work Breakdown Structure – Resource Requirements – Resource Rates (if known) – Activity Duration Estimates
– Historical Information – (project files, commercial cost databases, team knowledge
– Chart Of Accounts – coding structure for accounting; general ledger reporting
Chapter 7 – Project Cost
Management
• Cost Estimating Tools & Techniques
– Analogous Estimating – “top down”; using actual costs from previous project as basis for estimate
• Reliable when previous projects are similar and individuals have expertise – form of expert judgment
– Parametric Modeling – uses project characteristics in mathematical models to predict costs (e.g.building houses)
• Reliable when historical information is accurate, parameters are quantifiable, and model is scalable
– 2 types: Regression analysis, Learning Curve
– Bottom Up Estimating – rolling up individual activities into project total – smaller work activities have more accuracy -
Chapter 7 – Project Cost
Management
• Cost Estimating Tools & Techniques
– Pro‟s and Con‟s
– Analogous Estimating
• Quick - Less Accurate
• Tasks don‟t need to be identified – Estimates prepared with little detail and understanding of project
• Less costly – Requires considerable experience to do well • Gives PM idea of management expectations – Infighting at
high levels of organization
• Overall project costs are capped – Difficult for projects with uncertainty
Chapter 7 – Project Cost
Management
• Cost Estimating Tools & Techniques
– Pro‟s and Con‟s
– Bottom Up Estimating
• More Accurate – Takes time and expense
• Gains buy-in from the team – Tendency for team to pad estimates
• Based on detailed analysis of project – Requires that project be defined and understood
• Provides a basis for monitoring and control – Team infighting to get biggest piece of pie
Chapter 7 – Project Cost
Management
• Outputs from Cost Estimating
– Cost estimates – quantitative assessments of likely costs of resources required to complete tasks
• For all resources of the project (labor, materials, supplies, inflation allowance, reserve)
• Expressed in units of currency
– Supporting Detail
• Description of scope (reference to the WBS) • Documentation how estimate was developed • Indication of range of possible results
• Assumptions
– Cost Management Plan – how cost variances will be managed
– Cost Risk: associated to seller for Fixed Price; associated to buyer for Time and Materials budget
Chapter 7 – Project Cost
Management
• Cost Budgeting
– Involves allocation of total estimate to individual work to establish a cost baseline to measure performance
• Cost Budgeting Inputs
– Cost Estimate
– Work Breakdown Structure
– Project Schedule – includes planned start and finish dates for items costs are allocated to
• Needed to assign costs during the time period when the actual cost will be incurred
Chapter 7 – Project Cost
Management
• Cost Budgeting Tools & Techniques
– same as Cost Estimating Tools and Techniques
• Outputs from Cost Budgeting
– Cost Baseline – time phased budget to measure and monitor cost performance
• Developed by summing estimated costs by period (S curve of values vs. time)
• Larger projects have multiple baselines to measure different aspects of cost performance
Chapter 7 – Project Cost
Management
• Cost Control
– Concerned with influencing factors that create changes to the cost baseline that are beneficial
– Determining that the cost baseline has changed – Managing actual changes as they occur
• Monitor cost performance to detect variances
• Record all appropriate changes accurately in the cost baseline • Preventing incorrect, unauthorized changes being included in the
cost baseline
• Informing stakeholders of authorized changes
– Determine the “why‟s” of positive and negative variances
– Integrated will all other control processes (scope, change, schedule, quality)
Chapter 7 – Project Cost
Management
• Inputs to Cost Control
– Cost Baseline
– Performance Reports – meet, exceed budget
• 50/50 Rule – task is considered 50% complete when it begins and gets credit for remainder 50% only when completed
• 20/80 Rule - task is considered 20% complete when it begins and gets credit for remainder 80% only when completed
• 0/100 Rule – task only credited when fully completed
– Change Requests
– Cost Management Plan
• Tools & Techniques of Cost Control
– Cost Change Control System – defines the procedures by which the cost baseline may be changed
– Performance Measurement – assess magnitude of cost variations (Earned Value Analysis) and what is causing the variance
– Additional Planning – examine alternatives
– Computerized Tools – forecast planned costs, track actual costs, forecast effect of cost changes
Chapter 7 – Project Cost
Management
• Cost Control Outputs
– Revised Cost Estimate
• Modifications to cost information; require stakeholder approval and adjustments to other project areas
– Budget Updates – changes to approved cost baseline; revised in response to scope changes
– Corrective Action
– Estimate at completion – (EAC) – forecast of total expenditures
• Actual to date plus remaining budget modified by a factor (cost performance index)
– Current variances are seen to apply to future variances
• Actual to date plus new estimate for remaining work
– Original estimates are flawed, or no longer relevant
• Actual to date plus remaining budget
– Current variances are typical and similar variances will not occur in the future
Chapter 7 – Project Cost
Management
• Earned Value Analysis
– Integrates cost, schedule and scope
– Better that comparing projected vs. actual because time and cost are analyzed separately
– Terms:
• BCWS – Budgeted Cost of Work Scheduled (how much work should be done)
• BCWP – Budgeted Cost of Work Performed a.k.a. Earned Value (how much work is budgeted, how much did we
budget)
• ACWP – Actual Cost of Work Performed (how much did the completed work cost)
Chapter 7 – Project Cost
Management
• Earned Value Analysis
– Terms:
• BAC – Budget at Completion (how much did you budget for the total job)
• EAC – Estimate at Completion (what do we expect the total project to cost)
• ETC – Estimate to Completion (how much more do we expect to spend to finish the job)
• VAC – Variance at Completion (how much over/under budget do we expect to be)
Chapter 7 – Project Cost
Management
• Earned Value Analysis
– Formulas
• Variance (Plan – Actual)
• Cost Variance (CV): BCWP – ACWP; negative is over budget
• Schedule Variance (SV): BCWP – BCWS; negative is behind schedule
• Cost Performance Index (CPI): BCWP
ACWP
• I am only getting x¢ out of every $
BCWP ACWP
Chapter 7 – Project Cost
Management
• Earned Value Analysis
– Formulas
• Schedule Performance Index (SPI): BCWP
BCWS
– I am only progressing x % of the planned rate
• Estimate at Completion (EAC): BAC
CPI
– As of now we expect the total project to cost x$
• Estimate to Complete (ETC): EAC – ACWP; how much will it cost from now to completion
• Variance at Completion: BAC – EAC; when the project is over how much more or less did we spend (most common way of calculating EVA
BCWP BCWS BAC
Chapter 7 – Project Cost
Management
• Earned Value Analysis
– BCWP comes first in most formulas – If it is a variance, BCWP comes first – If it is an index, BCWP is divided by
– If the formula relates to cost, use AWCP
– If the formula related to schedule, use BWCP – Negative is bad; positive results are good
– ETC refers to “this point on”; EAC refers to when job is completed