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Cost & Schedule Planning

Photo by Jeff Sheldon

Cost & Schedule Planning. The major goal of the planning effort is to develop an integrated project schedule and budget.

Schedule planning
results in a schedule that describes the sequence of work and the logic necessary for successful project completion.

Cost planning begins with the development of a cost estimate for all authorized work that eventually leads to the establishment of the project budget.

Proper project planning ensures the amount of work to be accomplished, the time allotted to accomplish the project activities, and the resources required to complete the work scope are evenly balanced. Once the schedule and cost planning are concluded, the result is a time-phased project budget that is integrated into the project schedule. This resource loaded schedule and initial project budget are validated and approved as the Integrated Project Baseline which is signed off by all necessary Project Stakeholders as the Performance Measurement Baseline (PMB), a fundamental element of earned value management.

There are 4 main items in this phase:

  1. Cost Estimating. The purpose of cost estimating is to identify the resources needed to accomplish the scope of work and estimate the associated costs. Cost represents the dollar value required to accomplish the technical work scope within schedule and programmatic constraints.
  2. Procurement Planning. As part of the schedule Planning process, it is very important to take into account the Procurement strategy. As described earlier under the Project Planning header. Who is performing the work? Is it Self-perform, a prime contractor, multiple contracts, alliance, or a joint venture. Where are the materials, labour, and equipment coming from? Do we own, buy rent? Are there any long lead items? 
  3. Risk Analysis. The outputs from an associated Risk Analysis will interact with the planning phase of the project and may be used to confirm the planned dates, durations, and costs and help determine cost and schedule contingencies.
  4. Schedule Planning. The objectives of schedule planning are to generate a reasonable schedule of work that leads to successful project completion; and to establish a Schedule Baseline that, when integrated with estimated costs will result in an Integrated Performance Measurement Baseline for the project. 

    We will step through all these items. Please note, the overall planning process is an iterative one. As information from one of these items will often affect the outcome of the other. Changes will have to be made across each of these plans.
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