Cost Estimation of a Project

Question: Discuss about the Cost Estimation of a Project. Answer: Introduction: The project manager faces many problems while estimating cost in a project. The author agrees with the post as cost estimation is one of the vital aspects of project management. If the scope of the project is not well-defined then it will create problems for the project managers. The challenges include: Coordination neglect Unrealistic Costs (Jones, 2016). Experience based estimation Disregarding the capacity of the team The post suggests that the cost estimation needs to be revised regularly whenever a change is made in the project. It is very much necessary that the project manager uses different types of tools in order to control the cost of the project throughout its lifecycle. The post discusses about the accuracy of cost estimation which is created with the help of work breakdown structure. It helps in providing inputs to the process which are provided to the project manager so that they can have access on the comprehensive information (Abell et al., 2014).There are some other tools and techniques which can be used in order to get accurate estimation of cost. The tools and techniques include: Parametric estimation Analogous estimation Cost of quality (Jones, 2016). Reserve analysis The utilization of above tools and techniques are helpful in project budgeting while planning a project effectively. Discussion about Second post The cost of a project is estimated in order to establish a cost constraint for proper and effective operation of the project. The author agrees with the post as the post discusses several challenges which the project managers have to face while estimating cost (Ishii, Takano Muraki, 2014). The challenges are mainly due to presence of irrelevant data, available resources, pressure of time and unstable environment. There are many other reasons behind improper cost estimation which include: Estimating paradox Accuracy range (Mendes et al., 2014). Estimating software New technology The assignment provides three main key processes for managing the cost of the project properly. It is illustrated that the project managers used number of tools for analysing the cost properly. The tools that are used by the project managers helps in earning value management and monitoring as well as controlling the cost of the project properly (Mendes et al., 2014). The tools which are discussed for accurate cost estimation include expert judgement, bottom estimation and many more. The author provides additional tools and techniques which are very much helpful in estimating the cost of a project properly. The tools and techniques include: Cost of quality Project management estimating soft and many more. References Abell, C. E., Dekkers, J. C., Rothschild, M. F., Mabry, J. W., Stalder, K. J. (2014). Total cost estimation for implementing genome-enabled selection in a multi-level swine production system. Genetics Selection Evolution, 46(1), 1. Jones, K. (2016). Gregory K. Mislick and Daniel A. Nussbaum: Cost EstimationMethods and Tools.Chromatographia,79(1-2), 113-114. Ishii, N., Takano, Y., Muraki, M. (2014). An order acceptance strategy under limited engineering man-hours for cost estimation in EngineeringProcurementConstruction projects.International Journal of Project Management,32(3), 519-528. Mendes, E., Kalinowski, M., Martins, D., Ferrucci, F., Sarro, F. (2014, May). Cross-vs. within-company cost estimation studies revisited: an extended systematic review. InProceedings of the 18th International Conference on Evaluation and Assessment in Software Engineering(p. 12). ACM.