Project Cost Monitoring and Control Sample Proposal

During project management, a project manager is usually tasked with guiding a project to completion. In addition, a project’s deliverables must be made in line with the project requirement’s core factors of scope, cost, schedule, and quality to be described as a strategic success. Monitoring of these success factors includes collecting their respective performance data, analyzing it, and generating the necessary reports to determine the performance trajectory of each factor. Controlling, on the other hand, involves reviewing the actual project performance reports against the planned trends, developing possible alternatives, and selecting the appropriate option as a corrective action. Further, project control limits are used as the minimum and maximum thresholds and are vital in controlling a project's constraints. When a factor is outside the control limits, corrective action is necessary to return it to the planned course. Cost monitoring and control help prevent projects from running into significant cost overruns, which can contribute to failures.

Dreams Technologies (DT) is a technology company based in Maryland, US. Founded in May 1998, Dreams Technologies focused on hardware installations and configurations for businesses and organizations within the state. Throughout the years, the organization took up other information technology (IT) services, including systems security and compliance, cloud service consultancy, and networking. Further, the organization expanded its client base to include businesses outside the state, and the government, and as of 2012 began acquiring clients worldwide. This expansion of the client base has seen the organization set up two additional critical branches in two other states within the US. The main branch in Maryland is used to serve both the US government as a client and several international clients. Further, it is used to spearhead critical projects and operations sponsored by the US government, and also at the request of local or international clients. Dreams Technologies undertakes a project as either the project lead or as a subcontractor for other project organizations. As is the nature of other projects, each project carried out by DT is usually unique in terms of complexity, uncertainties, and risks.

Among the core projects undertaken by the organization is setting up networking infrastructure. These projects involved designing and developing network architectures, planning and coordinating network installations, and deploying and configuring network infrastructures depending on the clients’ needs. Further, networking projects involve maintaining and upgrading existing networking infrastructure. Furthermore, systems security and compliance projects involve assessing and evaluating a client’s IT security systems. These projects are used to determine a client’s preparedness to deal with cyber threats and any other occurrence that could disrupt normal operations within the business.

Moreover, these projects range from evaluating physical devices for cybersecurity risks to analyzing the networks and applications for potential threats. During these projects, Dreams Technologies is usually tasked with developing the necessary standards and procedures for dealing with possible cyber threats and operational disruptors. Cloud service consultancy involves spearheading a business’s migration to cloud computing from physical computing. Dreams Technologies (DT) is usually tasked with designing, developing, and implementing cloud solutions for businesses in relevance to their managerial and operational goals and objectives. Further, DT carries out scheduled maintenance of the cloud resources and applications as required by clients.

Dreams Technologies (DT) operates with a set of strategic objectives when managing projects for its clients. Firstly, DT focuses on the provision of quality and sustainable solutions to all its clients. Secondly, it aims to operate within a professional code of ethics both internally and with its clients. Moreover, DT is always focused on embracing innovation to help it continuously improve the products and services provided to clients. This continuous improvement is critical for the growth of DT’s operations and brand, which will help increase its client’s position.

Project documentation is a crucial component of project management. Documentation starts before project planning in most projects. Documentation concerning the project cost, particularly in complex projects, is often voluminous. This data is often collected from project planning, contractual and procurement processes, cost management processes, and more. The information contained in the cost documentation usually lacks critical pieces that lead to gaps in cost management. The lack of comprehensive information on the project cost leads to the generation of unreliable control thresholds. Further, the performance data used is incorrect hence the comparative inferences against the control limits are often incorrect. In some instances, documentation reports are often produced in bulk without a proper order and format, which is a huge concern for project managers. Sorting this data is a task that consumes both time and effort, particularly for the project manager.

Project managers have in past resulted in manual processes for gathering and evaluating cost data, which is a tedious and resources-intensive exercise. The errors resulting from the lack of cost data, omission of cost data from reports, and misrepresentation of data gathered lead to the development of cost performance reports that are not a true representation of the project performance. This results in inaccuracies and often false outputs from the control and monitoring processes. Further, where documentation is conducted, the records are usually not updated as frequently as required, more so at the end of phases, or when changes have been implemented. This inconsistency in documentation raises challenges when different sets of data are produced during monitoring and controlling processes. Once this occurs, the project manager is usually required to set resources for synchronizing the different sets of data to develop a fully comprehensible and current cost performance document.

One of the key requirements of a successful project is effective communication within the project team and across all stakeholder levels. Effective communication allows information to flow from one department, or team, to another as intended and on time. However, just as is the case with other projects, there have been instances where communication has broken down leading to information delays or a total lack of it. Communication during cost monitoring and controlling processes occurs at different levels. Information on cost management is usually gathered and passed to the project manager often late due to unclear communication channels and conflicting communication roles. Further, there are usually delays in presenting reports and data collected during the monitoring and control processes to other stakeholders for action. Consequently, delayed presentation of information reduces the response time for developing and deploying an appropriate action, either preventive or corrective. Furthermore, passing invalid information compromises any action or inaction taken as a corrective or preventive measure.

The decision-making process is a crucial component in monitoring and controlling processes. Once the need to correct the trend on cost progress arises, the executive and other key stakeholders are required to come up with actions necessary to correct it. For any corrective changes to be effected, a change management process is usually followed. The change management process is used to initiate, record, evaluate, approve, and monitor any changes to the project cost. The organization emphasizes a centralized decision-making process for the change management process, which allows the executive to provide oversight for the process. Whereas this centralized approach provides a clear chain of command, it has in the past been attributed to delayed implementation of approved changes. These delays have negatively impacted projects resulting in missed milestones and the emergence of conflicts between the executive and other stakeholders. The centralized nature of decision-making processes introduces significant delays between reporting the negative cost performance and the feedback received from the project executive. This delay negatively impacts the response time for deploying and monitoring changes applied to the project cost.

During project planning, cost baselines are developed to act as a guide to measure the cost performance during project management. The management gives less emphasis on these baselines and focuses on project requirements, scope, and developing the overall budget. Whereas this focus is crucial for project management, more so the overall project cost estimation, the lack of cost performance baselines hinders proper cost measurements during the cost monitoring and control process. The cost performance baselines provide a decomposition of the fundamental budget for activities as indicated in the work breakdown structure (WBS). Further, changes to the unit costs are not usually reflected in the cost baselines, if any were created during the project initiation phase. Improper baselines hinder correct cost performance measurements, which prevents accuracy during the cost monitoring and controlling processes.

Whereas documentation is described as important, an emphasis should be made on proper and comprehensive documentation. The project team should be trained on how to identify information associated with project cost, and how this information should be recorded. This data can be collected from the Gantt chart used in the project. At the end of different phases and milestones, project managers should ensure current project costs are indicated and updated according to the set timelines. The project manager should develop the necessary frequency for documenting the progress of the project’s cost. Further, every project should have a single master document that holds core progress reports concerning the project. All cost-related data should be updated on the master document, which will ease access to critical data when required during cost monitoring and controlling processes.

As discussed herein, effective communication is a significant factor in strategically successful projects. An emphasis is made on the need for a comprehensive communication management plan that details how information should flow, the frequency, and the channel to use, among others. The management at Dreams Technologies should develop a comprehensive plan following the template provided in the PMBOK. Further, at the start of every project, members should be trained in communication skills, and how to handle conflicts. Further, the project manager should assign the role of communicating matters regarding the cost to the relevant stakeholders as well as updating the cost document. This process will ensure there is a seamless flow of information regarding cost across the relevant departments resulting in the timely implementation of approved actions.

The advantages of centralized decision-making discussed herein notwithstanding, the management develops standards that can decentralize the making of decisions. Changes to cost can have an impact on the overall budget or be absorbed by other activities. With this in mind, a project manager should have the ability to make changes, albeit temporary ones, to address acute deviations in project costs. These changes can thereafter be made permanent, modified, or withdrawn entirely by the project executive. The swift action will reduce the response time to apply corrective actions and prevent significant cost overruns. In addition, decentralized decision-making will reduce conflicts between stakeholders as there are clear standards for the process.

The management at Dreams Technologies should emphasize cost baselines as they do cost estimations. Given that cost baselines are at times used to develop the overall project budget, the same baselines should be constantly monitored and compared against actual project costs. Further, these cost baselines should be recorded in an application such as Excel, and thereafter actual costs recorded. The application can then be used to generate visuals of cost performance, which can aid in the quick interpretation of the status of the cost performance and its trajectory. Further, visuals generated against the cost baselines can be submitted to the executive to emphasize the cost performance reports submitted by the project manager.