Process: Control Costs
Process Group: Monitoring and Controlling
Knowledge Area: Project Cost Management
Purpose
The Control Costs process involves monitoring the status of the project to update the budget and manage changes to the cost baseline. It ensures the project remains within its authorized budget and uses performance data to detect variances and take corrective actions.
Inputs
- Project Management Plan – Especially the cost management plan, cost baseline, and performance measurement baseline.
- Project Documents – Includes lessons learned register, cost estimates, and risk register.
- Project Funding Requirements – Defines when and how funds should be available.
- Work Performance Data – Real-time data on costs incurred, progress, and resource use.
- Organizational Process Assets (OPAs) – Policies, procedures, and historical cost data.
Tools and Techniques
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Earned Value Analysis (EVA) – Combines scope, schedule, and cost data to evaluate project performance.
- Cost Variance (CV)
- Schedule Variance (SV)
- Cost Performance Index (CPI)
- Estimate at Completion (EAC)
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Trend Analysis – Examines historical performance to predict future costs.
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Variance Analysis – Compares actual costs against baseline to identify and explain deviations.
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Reserve Analysis – Evaluates use of contingency and management reserves.
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To-Complete Performance Index (TCPI) – Calculates the efficiency required to meet the remaining budget.
Outputs
- Work Performance Information – Interpreted results showing how the project is performing financially.
- Cost Forecasts – Updated projections for future spending (e.g., Estimate to Complete, Estimate at Completion).
- Change Requests – Initiated when performance issues require budget adjustments.
- Project Management Plan Updates – Changes to the cost baseline or performance thresholds.
- Project Document Updates – Adjustments to risk register, lessons learned, and cost-related documents.
Role in the Process Group and Knowledge Area
- As part of the Monitoring and Controlling Process Group, Control Costs ensures that financial performance is regularly assessed and adjusted as necessary.
- Within Project Cost Management, it keeps spending aligned with approved budgets and supports effective cost governance.
Why It Matters
- Ensures Financial Health – Detects cost overruns early to enable timely corrective actions.
- Supports Decision Making – Provides actionable insights for adjusting plans and forecasts.
- Protects the Baseline – Maintains control over authorized budget changes.
- Drives Accountability – Tracks spending performance across teams and components.