Project Cost Tracking

Project Cost Tracking

Are you on top of your project spend?

If you work for a large company, you may have to do monthly forecasting and accruals, and have a forecast accuracy metric that gets reported up. I did that for years. I feel your pain. I had a great spreadsheet I used for entering POs and invoices and tracking and forecasting the spend. One of my coworkers had a version that I couldn’t get my head around – so I used my own. Later, when I started Bridge, I used a similar format to track costs. I showed it to my wife, who has an accounting background. She took one look and said something like, “Why on earth would you do it like that? Here, put those rows into columns, change this, …” The result was much better than the way I had done it for years. (Her version looked really similar to that coworker’s version that I didn’t take the time to figure out. Hmmm. Probably yet another lesson there.)

Forecasting, accruals, and metrics aside, are you staying on top of the project spend?

Spreadsheet. SAP reports. Whatever method you use. Are you coming in on budget?

Are you aware of all the POs that have been issued for the project? Has anyone else written POs and charged it to your project? That can make for a nice surprise later.

Are other groups, like Maintenance, charging hours on the project? More surprises.

How about change orders? The biggest miss I had on a project (budget and schedule) was, COINCIDENTALLY, on a project where the sponsor kept adding/changing the scope months after it was really practical. Adding insult to injury, I’d hear about some of the changes from the contractors – “Here’s that quote XXX asked for to do that change.” Huh?

If you can, pick a date beyond which there should not be any changes, AND track the cost of the change orders.

Shipping costs! These are easy to overlook. Be sure you include them, when necessary, in the budget.

Overtime costs. Contractors, integrators, programmers – those unplanned nights and weekends will slip up on you.

Training costs. Say you’re upgrading to a new PLC – the maintenance folks might need training on the new system.

Spare parts. At least order what you need for startup, and some spares if you can fit them on the budget.

Every boss I’ve ever had HATED this statement, but I always said, “I can only be late and over budget once on a project – If I install something that doesn’t work, it doesn’t work for a long time.” That’s actually a cleaned-up version of the expression, but you get the idea. Budget and schedule are important, but make sure you don’t sacrifice quality or performance.

However the project turns out, make note of any learnings, so you can be better at cost tracking next time.