Taking on a big project, you will always be facing pressure on several fronts – the pressure to deliver results, the pressure to meet deadlines and timeframes, the pressure to present the best side of you. These pressures are often at the forefront of a manager’s agenda, and it sometimes happens that another major pressure and concern goes unchecked – cost management. On a basic level, cost management involves being prudent with the expenses that go into a project, but there is much more to it. Cost management should be involved in every step of a project, from the initial planning phase to the post-delivery phase. To make it clearer, we will break down some top tips.
1. Make estimates and prepare
Taking the time to make estimates and preliminary evaluations of the project will play an important role in keeping expenses down later. Not only will you have a good understanding of approximately how much the project will cost in total, but you can also make more specific estimates for specific stages. During the preparation stake, it is important to take into account stakeholders’ needs and stipulations, or you might find yourselves forced to make drastic and expensive changes later in the process.
2. Apply special tools and practices throughout the project
Some companies only perform reviews of costs after a certain stage of a project has been completed, and all this information gives them is how much was spent in this period. With a special organizing tool (such as a logging program used by the team), you can keep track of expenses as they occur and discover issues before they grow and significantly impact the whole endeavor. Apart from software, you can also instruct your team to be efficient in how company resources are spent, as well as be more active in looking for ways to improve this efficiency.
3. Take full advantage of your authority
Decisiveness in project management is not a behavioral quirk, it is essential. Your project will thrive under firm leadership, so you will need to put great care and thought into your decisions. From the start, you will need to select a good team for the problem, which you know will be qualified to handle it and work together harmoniously. You may also want to implement cost controls into certain aspects of the project, and allocate some part of the budget to “surprises” – costs that are unexpected and unavoidable, usually occurring from factors beyond your control.
4. Continue improving over time
Even when your project is in full swing, you should not stop making forecasts or looking for ways to improve. In fact, facing the realities of the work, you will often be able to make more accurate forecasts than you would in the initial planning stage. As for improvements, it is certainly convenient to just go along with a plan that has proven to work, but you can save costs by making improvements to work processes and project approach. It will take a bit more effort than following a plan, but can reap great benefits in the long run.