What if you have more money than you need

If you investigate your total project costs and discover that you have more budget than costs, you have some decisions to make. Depending on the type of project, the situation, and the amount of extra budget, you can:

• Reserve the buffer. Use the extra funds as insurance against potential risks.

• Add resources. Use the money to hire resources and take some of the load off over-allocated resources or bring in the finish date.

• Add scope. Add tasks you were hoping to include, but thought you wouldn't have enough money to do. Build in a higher level of quality. If applicable, increase quanti ties being produced.

• Inform your manager or client that you can complete the project well under budget.

Checking Your Cost Assumptions

If you find that your scheduled costs are higher than your budget, first review the individual costs themselves. Check the resource rates as well as fixed costs for tasks and make sure they're accurate.

To check resource rates, review the Resource Sheet with the Entry table applied. With the default fields in the Entry table, you can see each resource's standard rate, overtime rate, and cost per use.

To check fixed costs for tasks, review a task sheet such as the Gantt Chart with the Cost table applied. The Fixed Cost field displays any costs associated with the tasks that are independent of resource costs.

Adjusting the Schedule to Reduce Costs

If many of your resource costs are based on time periods such as an amount per hour or per day, you might be able to cut costs if you can reduce task durations. For example, suppose you have a 2-day fixed-units task assigned to a $100/hour resource. By default, this resource is assigned to 16 hours of work, for a cost of $1600. If you reduce the duration to 1 day, the work is reduced to 8 hours, and the cost is reduced to $800.

When you reduce task duration in a fixed-units or fixed-duration task, the amount of work is also reduced. However, if you reduce duration for a fixed-work task, work stays the same and assignment units increase. In this case, resource costs would not be reduced.

For more information about changing durations, see "Checking and Adjusting Durations" earlier in this chapter.

Adjusting Assignments to Reduce Costs

Another way to reduce work and therefore cut costs is to reduce work directly. In effect, you're cutting the amount of time that resources are spending on assigned tasks.

The manner in which a work reduction affects your task and resource scheduling depends on the individual task types. When you decrease work in a fixed-units or fixed-work task, duration is reduced. When you decrease work in a fixed-duration task, units are decreased.

To change work amounts for individual resources, display the Task Usage view or Resource Usage view, and edit the Work field for the assignment.

Project Management Made Easy

Project Management Made Easy

What you need to know about… Project Management Made Easy! Project management consists of more than just a large building project and can encompass small projects as well. No matter what the size of your project, you need to have some sort of project management. How you manage your project has everything to do with its outcome.

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