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Since this is the first planning process for the knowledge area, with an aim towards creating the Cost Management Plan, the tools and techniques used in this process are the “generic” ones that apply to any knowledge area planning process, namely expert judgment, data analysis, and meetings.

Let’s discuss some of the specifics of these tools and techniques as they relate to the knowledge area of cost management.

7.1.2  Plan Cost Management:  Tools and Techniques

7.1.2.1  Expert Judgment

Who is going to assist your project team in creating the cost management plan?   Experts with specialized knowledge of:

• Creating the budget on previous similar projects
• Cost estimating and budgeting techniques that are used in the application area in general
• Earned value management

7.1.2.2 Data Analysis

What kind of options will be considered for funding the project?   Will it be self-funding from the organization’s overall budget, funding with equity, or funding with debt?  Alternatives analysis will help decide which option will be best for the organization, as well as how to acquire project resources (should you use your own resources, purchase them, rent or lease them?).

7.1.2.3 Meetings

Meetings should be held by the project team with experts invited (see 7.1.2.1 above) to help the team use the data analysis techniques mentioned above (see 7.1.2.2 above) in order to help put together the cost management plan.

The details of the cost management plan will be covered in the next post.

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