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15thSeptember

Although the era of managing project costs with actual pen and paper is definitely over, many organizations might still be using tools like Microsoft Excel to control the costs of their projects. If these are small projects, with limited (financial) risks and just a few resources, that’s fine. No need to look for alternatives, because you sure will get the job done. However, when things start to get serious and projects grow bigger with increased complexity and more and more stakeholders, you might consider a different view on project controls software.

Measure progress

The basis of proper cost control is knowing what has been done in relation to what remains to be done. That progress relates to both costs and schedule, so knowing where you are right now gives an indication of total costs at completion, as well as when the project is expected to be completed. Project controls software provides the means to gather all the relevant information you need to determine the progress of a project, as well as ability to process that information to make reliable predictions about the expected development of that project.

Manage actual costs

To keep track of the money spent on a project so far, it’s important to store it in a well-structured way, allowing for analysis and benchmarking. Assigning your actuals to cost items, breakdown structures and schedule helps to gain insight into your expenditures compared to the original budget. Project controls software also allows you to distinguish between actual costs and commitments, in order to further specify the status of a project. 

Earned value management

Earned value management, or EVM, is a project management technique that provides insight in the work performed so far and the value it represents. Cost control software like Cleopatra Enterprise has far more capabilities to perform EVM and the related analysis, than any existing spreadsheet tool.

Reporting

It’s not an easy task to capture the status of a large and complex project in a way that is understandable for management yet to-the-point enough to not waste valuable time on details or irrelevant information. With the use of proper software you are able to create real-time dashboards and reports that present the project’s costs, metrics, KPI’s and much more.

As said before, not every project requires extensive software for cost control. Yet it is important to take it into consideration before you start project execution, rather than stubbornly sticking with Excel and regretting that decision halfway through the project.

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