chapter  15
Cost Management
ByGary L. Richardson, Brad M. Jackson
Pages 16

This chapter describes the activities related to project cost management in the planning phase. There are three basic project planning cost-related activities: cost management planning, cost estimation, and budget determination. Project budget accuracy is an often-misunderstood concept. Many project cost components occur through allocations or time-based charges. The most obvious dynamic is unplanned work resulting from requested and approved changes to the original project scope. A broader management question involves how to physically incorporate an approved change request into the project work plan. The chapter describes dynamic budgeting issues that have the potential to consume budget funds that were not defined in the original base plan. Each of these variance situations will occur to some degree during the project life cycle and some arrangement for handling each category needs to be part of the plan and somehow reflected in an overall budget view.