Cost and Value Management in Projects

Cover
Cost and Value Management in Projects
Copyright
Contents
About the Authors
Introduction to the Second Edition
Chapter 1 Introduction to the Challenge of Cost and Value Management in Projects
	1.1 Importance of Cost and Value Management in Projects
	1.2 Keys to Effective Project Cost Management
	1.3 Essential Features of Project Value Management
	1.4 Organization of the Book
	Chapter Summary
	References
Chapter 2 Project Needs Assessment, Concept Development, and Planning
	2.1 Needs Identification
	2.2 Conceptual Development
	2.3 Project Feasibility
		2.3.1 Five Areas of Project Feasibility
		2.3.2 Benefits of Conducting a Project Feasibility Study
	2.4 The Statement of Work
	2.5 Project Planning
	2.6 Project Scope Definition
		2.6.1 Purpose of the Scope Definition Document
		2.6.2 Elements of the Scope Definition Document
		2.6.3 Project Scope Changes
	2.7 Work Breakdown Structure
		2.7.1 Types of Work Breakdown Structures
		2.7.2 Work Breakdown Structure Development
		2.7.3 Coding of Work Breakdown Structures
		2.7.4 Integrating the WBS and the Organization
		2.7.5 Guidelines for Developing a Work Breakdown Structure
	Chapter Summary
	Discussion and Review Questions
	References
Chapter 3 Cost Estimation
	3.1 Importance of Cost Estimation
	3.2 Problems of Cost Estimation
	3.3 Sources and Categories of Project Costs
	3.4 Cost Estimating Methods
	3.5 Cost Estimation Process
		3.5.1 Creating the Detailed Estimate
	3.6 Allowances for Contingencies in Cost Estimation
	3.7 The Use of Learning Curves in Cost Estimation
	Chapter Summary
	Discussion and Review Questions
	References
Chapter 3a Appendix to Chapter 3: Forecasting Methods for Cost and Value Management
	3A.1 Categories of Forecasting in Project Management
	3A.2 Forecasting Methods for Projects
	3A.3 Time Series Analysis
	3A.4 Linear Regression Analysis
	3A.4.1 Evaluating the “Fit” of the Regression Line
	3A.4.2 Limitations in Forecasting Using Linear Regression
	3A.4 Forecasting the Project End Conditions
	3A.5 S-Curve Forecasting
	3A.6 Technological Forecasting
	Chapter Summary
	Discussion and Review Questions
	References
Chapter 4 Project Budgeting
	4.1 Issues in Project Budgeting
	4.2 Developing a Project Budget
		4.2.1 Work Breakdown Structure (WBS)
		4.2.2 Issues in Creating a Project Budget
	4.3 Approaches to Developing a Project Budget
		4.3.1 Top-down Budgeting
		4.3.2 Bottom-up Budgeting
		4.3.3 Preparing the Project Budget
	4.4 Activity-based Costing
		4.4.1 Steps in Activity-based Costing
		4.4.2 Cost Drivers in Activity-based Costing
		4.4.3 Sample Project Budget 1
		4.4.4 Sample Project Budget 2
	4.5 Program Budgeting
		4.5.1 Time-phased Budgets
		4.5.2 Tracking Chart
	4.6 Developing a Project Contingency Budget
		4.6.1 Allocation of Contingency Funds
		4.6.2 Drawbacks of Contingency Funding
		4.6.3 Advantages of Contingency Funding
	4.7 Issues in Budget Development
	4.8 Crashing the Project: Budget Effects
		4.8.1 Crashing Project Activities—Decision Making
	Chapter Summary
	Discussion and Review Questions
	References
Chapter 5 Project Cost Control
	5.1 Overview of the Project Evaluation and Control System
		5.1.1 Project Control Process
	5.2 Integrating Cost and Time in Monitoring Project Performance: The S-Curve
	5.3 Earned Value Management
	5.4 Earned Value Management Model
	5.5 Fundamentals of Earned Value
	5.6 EVM Terminology
	5.7 Relevancy of Earned Value Management
	5.8 Conducting an Earned Value Analysis
	5.9 Performing an Earned Value Assessment
	5.10 Managing a Portfolio of Projects with Earned Value Management
	5.11 Important Issues in the Effective Use of Earned Value Management
	5.12 Benefits of EVM
	5.13 EVM Using Microsoft Project
		5.13.1 Step 1. Enter Resources in the Resource Sheet View
		5.13.2 Step 2. Assign Resources to Tasks
		5.13.3 Step 3. Save the Project Baseline
		5.13.4 Step 4. Record Project Actuals
		5.13.5 Step 5. Review the EVA View and Reports
		5.13.6 Step 6. Calculate Schedule Performance and Cost Performance indices
		5.13.7 Summary: Earned Value Management in Six Easy Steps
	Chapter Summary
	Discussion and Review Questions
	References
Chapter 6 Cash Flow Management
	6.1 The Concept of Cash Flow
	6.2 Cash Flow and the Worth of Projects
		6.2.1 The Time Value of Money, and Techniques for Determining It
		6.2.2 Applying Discounting to Project Cash Flow
	6.3 Payment Arrangements
		6.3.1 Cost-Reimbursable Arrangements
		6.3.2 Payment Plans
		6.3.3 Claims and Variations
		6.3.4 Cost Variation Due to Inflation and Exchange Rate Fluctuation
		6.3.5 Price Incentives
		6.3.6 Retentions
	Chapter Summary
	Discussion and Review Questions
	References
Chapter 7 Financial Management in Projects
	7.1 Project Financial Management
	7.2 Project Accounting
	7.3 Financing of Projects Versus Project Finance
	7.4 Principles of Financing Projects
	7.5 Types and Sources of Finance
	7.6 Sources of Finance
	7.7 Cost of Financing
	7.8 Project Finance
	7.9 The Process of Project Financial Management
		7.9.1 Conducting Feasibility Studies
		7.9.2 Planning the Project Finance
		7.9.3 Arranging the Financial Package
		7.9.4 Controlling the Financial Package
		7.9.5 Controlling Financial Risk
		7.9.6 Options Models
	Chapter Summary
	Discussion and Review Questions
	References
Chapter 8 Value Management
	8.1 Concept of Value
	8.2 Dimensions and Measures of Value
	8.3 Overview of Value Management
		8.3.1 Definition
		8.3.2 Scope
		8.3.3 Key Principles of VM
		8.3.4 Key Attributes of VM
	8.4 Value Management Terms
	8.5 Need for Value Management in Projects
	8.6 The Value Management Approach
		8.6.1 Cross-functional Framework
		8.6.2 Use of Functions
		8.6.3 Structured Decision Process
	8.7 The VM Process
	8.8 Benefits of Value Management
	8.9 Other VM Requirements
	8.10 Value Management Reviews
	8.11 Relationship Between Project Value and Risk
	8.12 Value Management as an Aid to Risk Assessment
	8.13 An Example of How VM and Risk Management Interrelate
	8.14 Project Benefits Management
	Chapter Summary
	Discussion and Review Questions
	References
Chapter 9 Change Control and Configuration Management
	9.1 Causes of Changes
	9.2 Influence of Changes
	9.3 Configuration Management
	9.4 Configuration Management Standards
	9.5 The CM Process
	9.6 Role and Benefits of Configuration Management in Projects
	9.7 Control of Changes
	9.8 Change Control Procedure and Configuration Control
	9.9 Responsibility for the Control of Changes
	9.10 Crisis Management
	9.11 An Example of Configuration Management
	Chapter Summary
	Discussion and Review Questions
	References
Chapter 10 Supply Chain Management
	10.1 What Is Supply Chain Management?
	10.2 The Need to Manage Supply Chains
	10.3 SCM Benefits
	10.4 Critical Areas of SCM
		10.4.1 Customers
		10.4.2 Suppliers
		10.4.3 Design and Operations
		10.4.4 Logistics
		10.4.5 Inventory
	10.5 SCM Issues in Project Management
	10.6 Value Drivers in Project Supply Chain Management
	10.7 Optimizing Value in Project Supply Chains
		10.7.1 Total Quality Management
		10.7.2 Choosing the Right Supply Chain
	10.8 Project Supply Chain Process Framework
		10.8.1 Procurement
		10.8.2 Conversion
		10.8.3 Delivery
	10.9 Integrating the Supply Chain
	10.10 Performance Metrics in Project Supply Chain Management
	10.11 Project Supply Chain Metrics and the Supply Chain Operations Reference (SCOR) Model
	10.12 Future Issues in Project Supply Chain Management
	Chapter Summary
	Discussion and Review Questions
	References
Chapter 11 Quality Management in Projects
	11.1 Definition of Quality in Projects
	11.2 Elements of Project Quality
		11.2.1 The Project’s Product
		11.2.2 Management Processes
		11.2.3 Quality Planning
		11.2.4 Quality Assurance (QA)
		11.2.5 Quality Control
		11.2.6 Corporate Culture
	11.3 Total Quality Management in Projects
	11.4 Root Cause Analysis
	11.5 Quality Management System
	11.6 Quality Management Methods for a Project Organization
		11.6.1 The Six Sigma Methodology
		11.6.2 The Six Sigma Model for Projects
		11.6.3 Application of Six Sigma in Software Project Management
	11.7 Quality Standards for Projects
	Chapter Summary
	Discussion and Review Questions
	References
Chapter 12 Integrating Cost and Value in Projects
	12.1 The Project Value Chain
	12.2 Project Value Chain Analysis
	12.3 Sources and Strategies for Integrating Cost and Value in Projects
		12.3.1 The Project’s Inbound Supply Chain
		12.3.2 Project Design
		12.3.3 Project Development
		12.3.4 Project Delivery/Implementation
		12.3.5 Costs of the Project Life Cycle Employing the LCC Model
	12.4 Integrated Value and Risk Management
	12.5 The Project Cost and Value Integration Process
	Chapter Summary
	Discussion and Review Questions
	References
Index
EULA