Project Cost / Finance Management

MSPM Bahria University

Week : 1-2

Dr. M Shakeel
 Name : Dr. Muhammad Shakeel,
Assistant Professor

Email Address: Shakeelnaama@live.com

Instructor Cell Number: 0333-9876657

Information
Preferred medium of contact: Email

Preferred Call/Text Time: 9AM to

9PM

Dr. M Shakeel
 Introduce Instructions:
INTRODUCTION Students to
Instructor and His / Her Name
one another Profession & Qualification
Any 3 things you want to learn from this
course
Why you picked MSPM degree program
Anyone working as Project Manager
What is one goal you’d like to accomplish
during your lifetime?

Dr. M Shakeel
 30% Mid Term

How 30% Assignments/Quizzes

Grading • Quizzes, Tests, Assignments, and
will be Final Project

done? 40% Final Exam

Dr. M Shakeel
 •Course Description

•Project Cost/Finance focuses on the cost

management of projects which plays a pivotal
role in any project. This course is designed
considering project life cycle and its dependency
on cost throughout the life cycle.
Walkthrough •Course Objectives
of Course •This course will cover the basic tools, skills, and
Outline knowledge necessary to successfully manage a
project considering cost and finance
Management area throughout project.
Industries best practices and their mappings to
PMI standards will also be considered as one of
the major course objectives to synchronies
students theoretical knowledge with current
market scenarios and practices.

Dr. M Shakeel
 Learning Outcomes
• Enhance knowledge for industries best practices
for Cost/Finance
• Management within organization and related
projects.
• Gain knowledge of Cost Management through
mapping of different project management
Walkthrough standards esp. PMI.

of Course • Perform comprehensive Estimation, Budgeting

and control of costs with in projects.
Outline • Formation of Cost Management Plans and there
control and monitoring
• within organization and Projects
• Knowledge of estimation, and control tools and
skills like Earned Value Management and its
implementation in projects

Gain knowledge of traditional cost

processes vs agile cost processes

Dr. M Shakeel
 Project Framework Mapping with Cost Management
processes

Introduction to Course and Project Management Standards

Role of a Project Manager

Capital Budgeting Techniques

Walkthrough
of Course Cost Categories , Pricing Categories, Components of Cost

Outline Project Planning (Pre-requisite for Cost Management)

Cost Estimation (Inputs, tools and Techniques)

Project Budgeting (Inputs, tools and techniques)

Project Cost Control (Performance Methods and Reporting)

using Earned Value Analysis

Dr. M Shakeel
What is a “Project”
examples from past

Pyramids of Giza
Dr. M Shakeel
Great Wall of China
Dr. M Shakeel
Taj Mahal

Dr. M Shakeel
Olympic games

Dr. M Shakeel
Define “Project”

The Project Management Institute (PMI) defines a

“project” as “a temporary endeavor undertaken to
create a unique product, service or result.”

Dr. M Shakeel
Define “Project”
The Key aspects
Temporary
Definite beginning and end
Timeline, scope and resources
To create a unique product, service, or result
Outside day-to-day business operation
People who don’t usually work together
Required resources are not from the existing

Dr. M Shakeel
Define “Project”

The Key components

Goal
Timeline
Budget
Stakeholders
Project manager

Dr. M Shakeel
What is “Project Management?”

“Project management is the art of creating an illusion

that any outcome is the result of a series of
predetermined, deliberate acts. Harold Kerzner,
Project Management, pg. 3

Dr. M Shakeel
What is “Project Management?”

Project management is the application of knowledge,

skills, tools, and techniques to accomplish specific task

Project management enables organizations to execute

projects effectively and efficiently

Dr. M Shakeel
What is “Project Management?”

Deliberate acts
knowledge
Skills
Tools
Techniques
For Specific requirement

Dr. M Shakeel
The Importance Of PM
PM helps individuals, groups, and public and private
organizations to:
Meet business objectives
Satisfy stakeholder expectations
Be more predictable
Increase chances of success
Deliver the right products at the right time
Resolve problems and issues
Respond to risks in a timely manner
Optimize the use of organizational resources
Identify, recover, or terminate failing projects
Manage constraints
Ect…

Dr. M Shakeel
 PMI (Project Management Institute) – USA

• Project Management Body of Knowledge PMBOK 6th

Edition (Sept 2017)
• CAPM, PMP, PgMp, PfMP, PBA, PMI – RMP, PMI – SP,
PMI – ACP
Project • https://www.businessnewsdaily.com/10847-pmi-
certification-guide.html

Management AXELOS – UK

Standards • PRINCE 2 – Project in Controlled Environment 2017 Edition

(Latest)
• Prince 2 , MSP , MOR, etc.
ISO – 21500

• Guide to Project Management

Dr. M Shakeel
Additional Standards for Cost Management Course

PMI (Project Management Institute) – USA

• Government Extension of the PMBOK® Guide

• Construction Extension to the PMBOK® Guide
• Software Extension to the PMBOK® Guide
• Earned Value Management Standards
• Practice Standards for Project Estimating
• PMI – BA - Business Analysis/Analyst Standards

AXELOS – UK

Management of Value (MoV)

MSP , ITIL , MOR, etc.

Dr. M Shakeel
What is “Cost?”
A cost is an expenditure required to produce or sell a
product or get an asset ready for normal use. In other
words, it’s the amount paid to manufacture a product,
purchase inventory, sell merchandise, or get equipment
ready to use in a business process

Dr. M Shakeel
Project Cost Analysis

Dr. M Shakeel
What is “Project Cost Management?”
Project Cost Management includes the processes
involved in planning, estimating, budgeting, financing,
funding, managing, and controlling costs so that the
project can be completed within the approved budget.
The Project Cost Management processes are:
Plan Cost Management
Estimate Costs
Determine Budget
Control Costs

Dr. M Shakeel
What is “Financial Management?”
FM is concern with the acquisition, financing and
management of assets with some overall goal in mind.
Projects budgeting:
The process of identifying, analyzing, and selecting
investment projects whose returns (cash flows) are
expected to extend beyond one year.
Interest (Simple & Compound)
Present Value
Future Value
Payback Period
Net Present Value
Internal Rate of Return

Dr. M Shakeel
Project Management Knowledge
Areas

25

Dr. M Shakeel