Tag Archives: Project Staff

Reader Q&A: The WBS and Cost

I wanted to share an email question I received through a Twitter contact of mine and my response.? Feel free to chip in with your own insights!

photo by Tracy O

photo by Tracy O

Question:

I hope you don’t mind me coming to you for advise and help with Project Management. I have this one question which I keep pondering on. In what way would you say that monitoring, planning and controlling project cost with a budget and organizing and planning a project using the WBS help or support one another?

Thanks!

My response:

Glad we connected on Twitter!? In my projects, the WBS is one of the key things that helps me with planning and monitoring costs.? The WBS is a prerequisite.? When I have a WBS, I can look at it and see where I should have charge codes set up for project staff, and where I should be reporting project costs.? Usually there is a specific level of detail that is relevant to various people.? The sponsor may want to see costs at level 3 of the WBS, and I may be interested in a little more detail at level 4, and the other project managers who work with me may be looking at level 5.? You may have specific stakeholders who only care about level 3 cost reporting for a particular element of the project, etc.

When putting estimates together, it’s important to first have a clear idea of what your scope is, and much of that comes from the WBS.? Bucket your basis of estimates this way, schedule, etc.? The iron triangle means that scope, cost, and schedule are integrated.

Monitoring and controlling your projects through status reports, EVM, etc.?? can really only done effectively by keeping in lock-step with your WBS structure.

Add your thoughts by leaving a comment for our reader below!

PM and Project Staff Reductions

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Moving up through the categories, I?ll discuss three now:

  • Project Manager Layoffs
  • Project Staff Reductions
  • Reduced PM rates.

Reading through the responses, may of them were not surprising. One thing I noted in a few posts was that some companies are shedding senior PMs and opting for less experienced ones. Of course I have no idea about the competencies involved?it is possible that a ?senior PM? is simply someone who has been there a long time, but is not a performer. Although I wish that were the case, I know from past experience that sometimes companies do make the decision to start with the people with the highest salary, without stopping to consider the value proposition. If make business decisions that way it?s their loss and they probably won?t be around for much longer.

    Project Manager Layoffs

  • Europe – I work mainly as a project management contractor, in the public (government) sector. From the various job sites I use, I have seen a significant drop in the number of private sector companies asking for consultant project managers, but the number of public sector jobs out there seems to be remaining pretty stable. Of course, it remains to be seen if that remains the case after the new financial year.
  • North America – major companies are announcing significant layoffs in ?management? positions, which always impacts PM positions. Several friends have been laid off in last quarter alone, all senior PMs.
  • Australia – More unemployed project managers, reduced tolerance for ineffective project managers
  • North America – Project management seems to be taking a beating right now. I know at least 4 project managers that have lost their jobs since the 1st of December. It looks like when companies are forced to let some people go that PMs are the first choice.

Reduced PM Rates

  • North America – PM consulting rates lowered due to increase in supply vs demand
  • Europe – More contractors available at short notice, prices 10% lower than this time last year

Project Staff Reductions

  • North America – Companies asking people to play dual roles – i.e. PMO Director and PM, PM and Business Analyst, etc.
  • North America – Less available human resources due to cutbacks & hiring freezes
  • Latin America – resource cutbacks make it difficult to appropriately staff projects
  • Asia – Engineering teams left to wonder where they?re going next. Layoffs usually affect non-eng positions first. But, hiring supportive positions is all but frozen.
  • Europe – The impacts i have seen is in the human resources level, the contract of less qualified/experienced resources, based on a low payroll. Less cost percentage for resources, and less resources. Clients are looking for a low budget services, creating a need for more effort from less resources.The Quality is being degraded in the benefit of cost.

Image by gamillos via Flickr