[High Items] Project Cost Management and Quality Management (Top Ten Managements)

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1. Project cost management

Whether the cost control is good or not is directly related to the quality of the project , so this chapter of cost management is very important;

Case analysis may include case analysis calculations, mainly focusing on earned value, forecasting technology calculations, etc. The focus of the morning exams is on the type of cost, management reserve, cost benchmark, evaluation, forecasting technology, cost estimation and definition of budget , process input, output, and tools.

Summary table of process, input, output, tools and techniques of cost management :

1.1 Planning cost management (planning)

What is the cost?

The full life cycle cost of the product is the total cost incurred in the acquisition phase (design, production, installation and testing activities, that is, the duration of the project), operation and maintenance, and the disposal of the product at the end of the life cycle
Types of costs :
(1) Variable costs: Costs that change with production volume, workload, or time are variable costs. Also called variable cost.
(2) Fixed costs: Non-recurring costs that do not change with changes in production volume, workload, or time are fixed costs.
( 3 ) Direct cost: the cost directly attributable to the project work is the direct cost. Such as project team travel expenses, wages, materials and equipment used in the project. (One project undertakes)
(4) Indirect cost: the expenses apportioned to this item H from the cost of item H shared by a management expense account or several projects jointly form the indirect cost of the project, such as taxes, additional benefits and Defense costs. (several items are apportioned)
(5) Opportunity cost: when a certain time or resources are used to produce a commodity, the lost opportunity to use these resources to produce other best substitutes is opportunity cost, which refers to everything in making choices After one of the biggest losses.
(6) Sunk cost: refers to the cost that Shanqian's past decision-making has already occurred, and cannot be changed by any present or future decision-making. Sunk cost is a kind of historical cost. It is an uncontrollable cost for existing decision-making. It will greatly affect people's behavior and decision-making. The interference of sunk cost should be eliminated when making investment decisions.
A contingency reserve
is a portion of the budget included in the cost basis for identified risks that have been accepted and for which contingency or mitigation measures have been developed.
Contingency reserves are usually part of the budget to cover "known-unknown" risks that affect item H. For example, it is possible to predict that some project deliverables will need to be reworked, but the amount of reworked work is not known, and a contingency reserve can be set up to deal with this unknown amount of work. Senior management approval is not required before use .
Management reserves
are project budgets set aside specifically for management control purposes to cover unforeseen work within the scope of the project . Management reserves are used to deal with "unknown-unknown" risks that will affect the project. Management reserves are not included in the cost baseline, but are part of the overall project budget and funding requirements and require senior management approval before use . When management reserves are used to fund unforeseen work, the management reserves used are added to the cost baseline, resulting in a change to the cost baseline.
A cost baseline
is an approved time-scheduled cost expenditure plan that reflects approved project cost changes over time and is used to measure and monitor actual project execution costs.
The project cost management process includes

cost management plan

The cost management plan is an integral part of the project management plan and describes how project costs will be planned, scheduled, and controlled .
Specify in the cost management plan: @Measurement unit, @Accuracy, @Accuracy, @Organization procedure link, @Control threshold, @Performance measurement rule, @Report format, @Process description, @Other details

1.2 Estimating costs (planning)

What is a cost estimate?

It is a cost forecast based on known information at a specific point in time.
When estimating the cost, it is necessary to identify and analyze the alternative cost schemes that can be used to start and complete the project; it is necessary to weigh the alternative cost schemes and consider the risks and the time cost of project members' learning;
But there is no need to consider whether the project is profitable; such as comparing self-made costs and outsourcing costs, purchasing costs and leasing costs, and multiple resource sharing schemes to optimize project costs.
During the project lifecycle, the accuracy of project estimates will gradually improve as the project progresses. For cost estimation,
all resources that will be charged to the project should be considered (e.g. special: inflation subsidy1, 1 financing cost net contingency cost1 etc.)

Steps to prepare a project cost estimate:

( 1 ) Identify and analyze the constituent subjects of the cost.
(2) Estimate the cost of each subject based on the identified project cost constituent subjects.
( 3 ) Analyze the cost estimation results, find out various costs that can be substituted for each other, and coordinate the proportional relationship between various costs.

1.3 Create a budget (planning)

How to specify a budget

The Line H budget includes all funds for approved projects. The cost baseline is the approved time-periodized project budget, excluding management reserves.
Principles to be followed in preparing project cost budget: ＄Based on project needs, @linked to project goals, must consider both project quality goals and schedule goals, @to be practicable, and @should be flexible.

Steps in cost budgeting:

(1) Allocate the total project cost to each work package of the project work breakdown structure. Decomposition is top-down, and different decomposition weights are set according to the amount of occupied resources.
(2) Redistribute the cost of each work package to the activities contained in the work package.
(3) Determine the time plan of each cost budget expenditure and the project cost budget plan.

1.4 Control costs (monitoring)

A cost baseline
is an approved, time-period project budget , excluding any management reserves, which can only be changed through a formal change control process, and used as a basis for comparison with actual results . The cost baseline is the sum of the approved budgets for the different schedule activities.
Cost budget:
First summarize the cost estimates and contingency reserves of each project activity to obtain the cost of related work packages. The cost estimates for each work package and their contingency reserves are then aggregated to obtain the cost of the control account . Then aggregate the cost of each control account to the cost basis . The cost estimates in the Shanqian cost basis are directly related to the schedule activities, so the cost basis can be allocated according to the time period, and an S-curve can be obtained
Determine total funding requirements and periodic (eg, quarterly or annual) funding requirements based on cost baselines . Cost baselines include projected expenditures, as well as projected liabilities; project funds are usually invested incrementally rather than sequentially, and may be uneven and dirty. If there is a management reserve, total capital requirements = cost basis + management reserve. In the funding requirements document, the source of funding may also be stated.
Many projects, especially item H, may have multiple cost baselines (or resource baselines) and consumable production baselines (eg
cubic meters of concrete per day) to measure different aspects of project performance.
The difference between the maximum funding requirement and the end value of the cost basis is the management reserve .
Project cost control (in units of work packages) includes:
(1) Influence factors that cause cost baseline changes.
(2) Ensure that all change requests are processed in a timely manner.
(3) Manage changes when they actually happen.
( 4 ) Ensure that the cost expenditure does not exceed the approved fund limit, neither the limit allocated by time period, by WBS component, or by activity, nor the total limit of item H.
( 5 ) Monitor cost performance, identify and analyze deviations from cost benchmarks.
( 6 ) Monitor work performance against capital expenditure.
(7) Prevent unapproved changes in cost or resource usage reports.
(8) Report all approved changes and their associated costs to relevant stakeholders.
(9) Try to control the expected cost overrun within an acceptable range.

1.5 Techniques and Tools of Cost Management

Tools and Technology
Computing of the first kind
Computing of the second kind

2. Project quality management

The core of quality project management, quality management is very important .
The focus of the morning exams over the years is on the tools and techniques of the quality process--the input and output of the operator, related quality management theories, and the knowledge points of the CMMI model. Case analysis in the afternoon like to test.

Summary table of processes, inputs, outputs, tools and techniques of quality management:

2.1 Basics of quality management

1. The national standard defines quality as: " the degree to which a set of inherent characteristics meet the requirements ".
2. The difference between quality and grade . Quality and grade are two different concepts. Examples of quality:
(1) A software product of low grade (limited functions) , high quality (no obvious defects, easy-to-read user manual), which is suitable for general use, can be approved.
(2) A software product of high grade (many functions), low quality (many defects, messy user manual), the functions of this product will be invalid and I or inefficient due to poor quality, and will not be accepted by users .
3. Quality management refers to all quality-related activities to achieve quality objectives . Activities directed and controlled in terms of quality, including quality policy and quality objectives as well as quality planning, quality assurance, quality control and quality improvement .
4. The quality policy is an integral part of the general policy and is approved by the top management .
Quality objectives should be decomposed and implemented to all members of each department and project for implementation, inspection and assessment.
5. Eight basic principles of ISO9000 quality management :
customer-centric, leadership, full participation, process approach, systematic approach to management, continuous improvement, fact-based decision-making, and mutually beneficial relationships with suppliers.
6. Total Quality Management (TQM) consists of 4 elements: structure, technology, personnel and change promoters , and
4 core features: quality management of all staff participation/golden process/total method/total result.
7. Six Sigma means "six times the standard deviation" , which is expressed in terms of quality as the rate of defective products per million (PPM) less than 3.4;
using DMAIC (determining, measuring, analyzing, improving, controlling) improvement methods for Improve the key processes of the organization;
the advantage of Six Sigma is to improve and ensure quality from the project implementation process , rather than to test and control quality from the results. This not only reduces the steps of quality control, but also avoids the resulting rework costs . More importantly, Six Sigma management cultivates the quality awareness of employees and integrates this quality awareness into corporate culture. (master)

2.2 Quality management process (planning->implementation->control)

Quality management process:

Planning Quality Management, Implementing Quality Assurance, Quality Control (Mastering)
Quality management plan (definition, basic requirements, preparation process, implementation inspection and adjustment), process improvement plan (process
boundary, process configuration, process measurement indicators, performance improvement goals).
Enterprise environmental factors that may affect the quality planning management process include (but are not limited to):
@Indian government regulations @Relevant rules, standards and guidelines for specific application areas @Working or operating conditions of projects or deliverables that may affect the quality of item H @Cultural perceptions that may affect quality expectations
The quality management plan is an integral part of the project management plan that describes how the organization's quality policy will be implemented and how the project management team intends to achieve the project's quality requirements . A quality management plan can be formal or formal. It can be very detailed or highly generalized. The quality management plan should be reviewed early in Item H
Quality measures are dedicated to describing an item or product attribute and how the quality control process will measure the attribute .
Quality measures are used to implement quality assurance and control quality processes. By measuring, the actual value is obtained . The allowable variation range of the measurement index is called the tolerance. Examples of quality measures include: punctuality, cost control, defect frequency, failure rate, availability, reliability, and test coverage.
A quality checklist is a structured tool , usually itemized, used to verify that a required set of steps has been performed. Based on the project and summation practice, the checklist can be simple or complex.
Quality assurance is generally performed by the quality assurance department or similar related departments .
The project manager and the relevant quality department do a good job in quality assurance. Implementing a quality assurance process also creates conditions for continuous process improvement. Continuous process improvement refers to the continuous improvement of the quality of all processes. Through continuous process improvement , waste can be reduced, non-value-added activities eliminated, and processes run at a higher level of efficiency and effectiveness.
Project specific results include both the intended end products (deliverables, etc.) or services and the results of the project process. The quality control of project products is generally in the charge of the quality control functional department, but the quality of project process results needs to be controlled by members of the project management organization. The quality control process may also include detailed activity and resource planning.
The quality of software management is mainly guaranteed by the combination of technical review and software testing .

2.3 Techniques and tools of project quality management

1. Technology in the planning stage

Including: cost-benefit analysis method, quality cost method, benchmarking, experimental design, etc.
(1) Cost-benefit analysis method : To conduct a cost-benefit analysis of the entire quality activity , it is necessary to compare its possible costs and expected benefits .
(2) Quality cost method : all costs incurred in the product life cycle , including all costs incurred for preventing non-conformity, evaluating whether a product or service meets requirements, and failing to meet requirements.
Consistency costs : prevention costs (training, templating, process, right time to do the right thing); evaluation costs (testing, inspection);
non-conformity costs (failure costs): internal failure costs (internal discovery: rework, scrap ); external failure costs (discovered by customers: liability, warranty, lost business)
(3) Benchmarking : comparing actual or planned project practices with those of comparable projects in order to identify best practices, form improvement ideas, and provide a basis for performance appraisal
(4) Experimental design : It is a kind of winnowing and five steps to identify which factors will affect specific variables of the product being produced or the process being developed.
(5) Other tools : Brainstorming, Force Field Analysis, Nominal Group Technique
✓ Brainstorming: A technique for generating ideas with thousands.
✓ Force Field Analysis: Graphics showing altered thrust and drag.
✓ Nominal group technique: Brainstorm ideas with a smaller group first, then
review ideas with a larger group.

2. Technical
quality audit, process analysis method, seven basic quality tools, statistical sampling, inspection, review of approved change requests in the implementation stage.

Quality audit , also known as quality assurance system audit, is a structural review of specific quality management activities
The objectives of the quality audit are :
(1) To identify all good and best practices being implemented.
(2) Identify any non-compliance practices, gaps and deficiencies.
(3) Share good practices from similar projects in your organization or industry.
(4) Actively and proactively provide assistance to improve the execution of the process, thereby helping the team to be more productive.
(5) Emphasize that each audit should contribute to the accumulation of lessons learned by the organization.
Quality audits
can be scheduled or random . Internal auditors with expertise in specific areas or third-party organizations can conduct quality audits. Internal or external auditors can conduct quality audits. Quality audits also confirm the implementation of approved change requests , including updates, corrective actions, defect remediation, and preventive actions.
Process analysis
refers to following the steps outlined in the process improvement plan to identify needed improvements . It also examines problems encountered during the operation of the process , constraints , and non-value-added activities identified.
The review link (review and inspection) is indispensable. It has been repeatedly emphasized that the quality of the project can be guaranteed through periodic review , and review is also an important link to ensure quality .
The quality of software projects is mainly guaranteed by the combination of technical review and software testing.
Statistical sampling
refers to selecting a part of relevant samples from the H standard population for inspection and measurement to meet the requirements in the quality management plan. (can reduce the cost of quality control)
Inspection : Can also be called review, peer review, audit or inspection, etc. Inspections may also be used to confirm defect remediation.
Testing, inspection, statistical sampling : also belong to the tools and techniques of quality control.

3. Seven basic quality tools

new seven and old seven

4. Supplementary learning content

1. The quality assurance personnel should complete the work in the whole project:
(1) In the planning stage, formulate the quality management plan and the corresponding quality standards
(2) Implement the quality inspection according to the plan, whether to implement the project work according to the standard process. Pay attention to the quality inspection during the project process, prepare the inspection list before each inspection, and record the relevant situation of quality management
( 3 ) Based on the inspection situation and records, analyze problems, find problems, and negotiate with the parties to solve them. After the problem is solved, it needs to be verified; if it cannot reach an agreement with the parties, it should be reported to the project manager or a higher-level leader until the problem is solved; (4)
regularly send quality reports to project stakeholders
(5) provide quality management requirements for project team members training or mentoring
2. The object of providing quality assurance is usually the project management team and the management of the implementing organization, while the participants in quality assurance activities should be all the staff of the project. Often, the role of quality assurance (QA) is not limited to finding and reporting problems with a project. Typical OA responsibilities include process guidance, process review, product audit, process improvement, and process measurement.
3. The difference between quality assurance and quality control