Industry Verticals for Project

Law Firm
Capital goods Manufacturing Company: Air Compressor, Heat Exchangers, Generator etc.
HR Firm
Ecommerce Organisation
Distribution Company
Pharma Company
IT enabled Service company
Engineering Construction Company
Architect

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Budgeting and Cost
Estimation

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Budget and Cost Estimation

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Estimating Project Budgets

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Case Study- Path Finder Mission
1976: NASA’s two Viking Mars-lander missions took 6 years and $3 billion to develop
21 year later…. 4th July 1997:Mars Pathfinder and Sojourner Rover landed on Mars at a
development cost of $175 Million
94 percent cost reduction over the earlier mission.

HOW?

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Case Study- Path Finder Mission
The means of limiting the cost of the mission were multiple and creative:
• Development was cost-capped, with no opportunity for more funds.
• identifying a set of “de-scope” options, which could be implemented in case the cost grew
beyond the fixed budget
• mission, flight, and ground systems designs were driven by existing hardware and system
capability
• a project cash reserve of 27 percent of the total budget was held back and carefully planned
for time-phased release throughout the duration of the project
• mission designers/builders transitioned into the testers/operators to save documentation,
time, labor cost, and chance of error

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Case Study- Path Finder Mission contnd…
• Existing NASA mission infrastructure was used rather than designing new systems
• Instituting time-phased “what if” and lien lists for real or potential current and anticipated
items of cost growth during the project
• Choosing to use a “single-string” but higher risk design and offsetting the risk by using more-
reliable parts
• 70 percent of major procurements contracts were fixedprice rather than cost-plus
• creative procurement, such as existing equipment spares, and accounting, such as lower
burden rate personnel

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Top- Down Budgeting

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Top- Down Budgeting

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Bottom Up Budgeting

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Bottom Up Budgeting

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Budgeting

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Work Element Costing

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Iterative Budgeting Process

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Iterative Budgeting Process

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Category/Activity Budgeting Vs Program
Budgeting

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Category/Activity Budgeting Vs Program
Budgeting

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Program Budgeting

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Program Budgeting

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Improving process of Cost Estimation

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Funding Non-Profitable Projects

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Project Bids and RFP’s
Technical Bid
Implementation Plan
Plan for Logistic support and Administration.
Past Experience

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Learning Curves

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Other Factors

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