So, if you as a PM don't do the majority of the cost estimating, but merely assimilate the estimates, what is your responsibility in the cost estimating function? When it comes to cost estimating, you're a busy person!
It turns out that there are costs bundled into the final estimate that any one cost estimator would not include. You provide these costs; for instance, you should include the costs of keeping people informed about the project's status. You also validate that the criteria used by each estimator are accurate. You collect the estimates and total them. You examine the time estimates discussed previously and make sure the cost and time estimates are in alignment with one another. In the event you need to procure outside resources, you need to ascertain the impact of obtaining those resources. You take into account the corporate budget cycle and also determine the risks associated with the cost estimates. It's even your responsibility to pick the cost estimating method utilized. You conduct meetings with sponsors in which you discuss the costs you've derived and how you derived them.
You should keep a sharp eye out for costs that everyone might've overlooked (remember the fiber-optic cables from the Real-World Scenario in Chapter 1?). You'll obtain formal bids from vendors for any outside work you're going to utilize in the project. You utilize the cost estimates to formulate the budget. Most importantly, you resolve any concerns or issues that arise from your cost estimating far ahead of the actual time to spend the money.
It' s also important that you realize there may be (at least) three levels of cost estimating that go on as your project unfolds:
■ At project evaluation time, you' l l produce some estimates that are in the constellation, but not the galaxy.
■ In the project' s design stage, you ' l l come up semi-detailed costs, essentially moving from the constellation to the galaxy.
■ At the cost estimating (design/construction) stage, you' l l try to nail down the costs, moving from the galaxy to the planet. Tip Final cost estimates are not so granular that you have no leeway, nor are they so broad that there s no meaning to them.
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