The two major components of project cost control

If you have some experience in your industry, no matter which that is, you’ll know, how hard it is to stay on top of things when it comes to cost control. Each time you undertake a project, you have to do all the planning, calculate the time, human resource, technical requirements and most important, the costs involved in the execution.

That’s why project cost control is often overlooked, but becomes the core for other issues regarding a project’s execution on time, without sparing on quality and without affecting the overall efficiency of the workflow.

To prevent any issues you might have with cost control, it’s important to keep in mind these two essential factors:

Estimation. You would be surprised how many projects are failing because of a bad budget estimation. Each step of the project should have an estimated budget, which is checked for accuracy various time. It’s the best way to make sure there aren’t any unwanted surprises along the road. Be realistic from the start, even when setting a deadline. If you’re not at least 80% sure your team can delivered the promised work on time, than you should just “go for it”. It’s the same with the budget, don’t assume you’ll get the job done with less people or with fewer resources. Better be safe than sorry. The project size, the cost and the schedule estimation, help you set up a realistic budget. Be aware, thou, that the slightest change in any of these categories will affect the other two as well. See if you have enough staff to complete the project, or if you need to outsource some of the work to other collaborators. Sometimes, managers don’t pay attention to the simplest things, like when some employees have vacation time and are unavailable for work.

Constant report and reviews. If you want to know exactly how good your estimation was, you have to keep track on the schedule and the costs involved. How many hours does an employee have to work? Do you need to bill overtime? How many hours do external collaborators work? What other expenses does the company have to cover? It’s easiest to prevent any uncomfortable situation by having reports on monthly basis, weekly basis, or even daily basis if need of the work hours and expenses made so far, because then you’ll be able to adjust your budget that way.

ExTreM Time Sheet and ExTreM Expense Report are two software products designed to manage and analyze data regarding project progress and overall company expenses. The automatic supervision of data entry makes the software easy to use and easy to integrate with the company’s payroll systems and is suitable for both smaller and larger companies, because it doesn’t require any special skills, but is able to manage a large volume of data at the same time.

Photo: Pixabay.com, user: geralt