The way to do this is as follows:
3.1 Start Querying Costs
For example, are 10 developers really required to support bug fixing when only 5 testers are running test scripts? In one
instance I realised that the test team were assuming they would take longer to modify a test script to test some
functionality, than the development team were proposing to make the change actually required!
3.2 Reduce Contract Resources
Start negotiations to start swapping expensive contract resources out and permanent resources in. So see if you can get
permanent Architects and Team Leads as they tend to stay on for a big part of the
3.3 Check Resource Costs Yourself
Sometime it is tempting to ask a Workstream Lead, “hey how much does a contract tester cost?”
. Sure it’s a good ballpark
figure but remember to double check it yourself. Organisations do sometimes equate resource costs purely to the amount they
are paid, but other’s include agency fee and any other tax such as VAT / State Tax as well. These can amount up to much more
when taken into account than the say “$700 pd” figure you were originally quoted.
3.4 Query The Process
In one Organisation I consulted at they determined requirements through numerous workshops which up to 15 people had to
attend. On one project this amounted to 43 separate workshops! To get around this I came up with a new process for gathering
which significantly reduced the timeframe and resources required to do this work.
3.5 Don’t be Bamboozled
Remember that whilst resources can be keen to work on a project, for many it will be simply another project. Understandably
if you’ve been forced to work to meet how many tight project deadlines you are hardly going to be enthusiastic about being
put on yet another project where you will probably need to work weekend and evenings to get delivered. Therefore be aware
that such workstreams will often increase how many resources and what timeframes they will need.
Do not therefore be bamboozled into believing everything you hear. Not everyone has either your or your project’s best
interests at heart!
You would be astonished once you’ve been through this process how much you can get your
project budget down to a level your
Project Sponsors are content with, and yet still ensure you have plenty of
contingency in it.
For example on one project I received a quote in from one workstream which insisted they needed to work 170 man days on the
project. I reckoned it was nearer 30 days so I pushed them on it. They came back with a revised quote of 120 days which my
boss was very pleased with. When it came to actually doing to work that team actually used just 40 man days, much as I
thought. However without my boss knowing I’d managed to get 1 month and about $100,000 contingency on the project despite
insisting there was none!
Estimating Project Costs – Tip
You need to learn how to hide
contingency in your project plan and
contingency in the project budget
so that when things go wrong, you have plenty of leeway to resolve them. Therefore ensure you use your experience and common sense rather than relying on any automated process which determines your project cost and you will be surprised how much easier it becomes to implement effective project cost controls once your project is up and running.
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