Cost Estimation, Budgets and Controls
A substantial portion of organizational resources are required to be allocated for all types of costs in any business enterprise. This is especially so for Project oriented organizations.
All the three dimensions, cost estimation, budgets and controls, are under the purview of Cost Engineering. The subject of Cost Engineering attempts to merge engineering principles and techniques to the subject of cost.
A cost estimator needs to consider not only the present cost structure but also needs to forecast changes during project execution tenure. This is more vividly so in the present dynamic and global scenarios. At the heart of this exercise is the risk perception along with risk profile of the organisation.
Whereas estimation of direct and indirect costs is relatively easy in an ongoing organisation, futuristic estimation of likely scenarios through the mechanism of provisions and contingencies, poses a challenge, sheerly because of complexities involved.
Control systems are an inbuilt function in all organisations. The controls however need to be at the points of actions. A decision regarding cost element to be controlled vis-ÃƒÂ -vis its point of action is a critical matter. There are many control tools available. The choice however depends on the culture of organisation.
This programme has the objectives of making participants aware of fundamentals of cost engineering and its sub-functions, connecting them logically. The participants would be taken through the relevant gamut of cost engineering and processes, involving team of various functionaries. Deliberations on high and low lights of certain elements of cost engineering will enable participants understand the practical applications effectively.
- Project managers and project team leaders who wish to build upon and consolidate their project management skills
- Project planning engineers and heads who need to develop their project management skills
- Senior project control and business services professionals who have the responsibility for planning, monitoring and controlling, and reporting on project budget and cost performance
Applications of Cost Engineering
Ã‚Â Course Content
Ã‚Â Session 1
- Introduction to Cost Engineering.
- Ã‚Â Cost Estimation Ã¢â‚¬â€œÃ‚Â Elements of Cost, Cost Classification
- Ã‚Â Direct Cost Indirect Cost
- Ã‚Â Provisions and Contingencies
- Risk Management
- Identification, evaluation, mitigation
- Contingency as cost of mitigation of a risk event
- Relevance to project control
- Marginal Costing
- Break Even Analysis
- Cost monitoring forecasting and Control
- Cash flow preparation
- Inflow, outflow, ,Net Flow, Cumulative Cash Flow
- Deficit Cash Flow, Determination of Project Working Capital
- Two Dimensional Cash Flow as Project Control Tool
- Value Management
Mr. Vilas Mahajan
HeÃ‚Â is an M.B.A. in Finance from Jamnalal Bajaj, Mumbai and B.E. (Mechanical) from Pune University. He has rich and varied experience of four decades from Corporate World including MNCs, followed by in academics for four years His core expertise areas relate to Cost Engineering, SCM, Contracting, International Tendering, and Execution along with costing and Budgeting.
He has travelled to many countries in connection with assignments in these areas. He has conducted several training programmes on the expertise areas across an array of organizations