Comments on: Activity Based Costing in Project Management

By: Bill Duncan

Bill Duncan — Wed, 25 Feb 2009 01:09:28 +0000

I think this article misses the point. The main objective of ABC is to ensure that overhead costs are properly allocated. ABC is NOT simply estimating the costs of project activities. It is about deciding HOW to allocate the costs of administrative and management work to each activity.

For many if not most projects, using the traditional cost driver of direct labor hours will be more than adequate.

Duncan

William R. Duncan, Project Management Partners
Primary author of the original version of “A Guide to the Project Management Body of Knowledge”
Board Chair, PMCert, the independent certification body of asapm

By: Bill Duncan

Bill Duncan — Wed, 25 Feb 2009 01:09:00 +0000

For many if not most projects, using the traditional cost driver of direct labor hours will be more than adequate.

Duncan

By: Travis Anderson

Travis Anderson — Sat, 21 Feb 2009 19:48:08 +0000

Hello Dr. PDG.
I appreciate your insight and wisdom. Please continue to communicate additional pertinent information on ABC. You mentioned it on an earlier post of mine and made me curious. I often seek out your tid-bits and learn from your comments. Keep up the good work.

By: Travis Anderson

Travis Anderson — Sat, 21 Feb 2009 19:48:00 +0000

By: schlossBlog » #143 Activity Based Costing im Projektmanagement

schlossBlog » #143 Activity Based Costing im Projektmanagement — Sat, 21 Feb 2009 10:48:09 +0000

[...] Anderson hat einen lesenswerten Beitrag über den Einsatz von Activity Based Costing im Projektmanagement (Englisch) verfasst. Die Kostenzuordnung auf Aktivitäten orientiert sich dabei an der Work [...]

By: Glen B. Alleman

Glen B. Alleman — Fri, 20 Feb 2009 01:30:43 +0000

Paul,
I suspect we’ll have difficluty here with the narrow band forum. The Work Package is the planning level.
PMBOK states (on page 3 of the WBS Guide),
“The work planned contained in the lowest level WBS components, which are called Work Packages, can be scehduled, cost estimated, monitored, and controlled.”
The “activities” – can I read tasks – are inside the WP’s and are usually not tracked at the activitiy level. The CAM (Control Account Manager) is accountable for reporting physical percent complete at the WP level.
Irregardless of all the possibilities, can the PP&C systems support ABC? The CPR (Contract Performance Report – all 5 formats) and NASA 533M’s are not structured in ABC paradigm.
This is an important discussion. I’m with Wayne Abba and Paul Solomon next month for a brain storming dinner durin the PMI Symposium. This will be a good question to ask them from the DoD point of view.