ABSTRACT
This chapter looks at cost management. There are three parts to cost management on a project. The first part is to work out one’s budget—that is the amount of money that they believe they will require in order to do the job. The second part is tracking and monitoring one’s actual spend to ensure that they are not exceeding their budget. And the final part is cost forecasting, which entails working out—at any point in the project—how much money one will need to finish the project. The chapter describes a worked example of how the cost plan above was arrived at and how it gets managed. Budgeting for contingency and risk is entirely sensible, but both will lock up funds that might never be used, or be better used elsewhere. As part of one’s regular cost plan reviews, consider whether they are carrying too much contingency or risk in their plan.
