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
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.
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