Professional Documents
Culture Documents
Download Information Technology Project Management 9th Edition Schwalbe Solutions Manual all chapters
Download Information Technology Project Management 9th Edition Schwalbe Solutions Manual all chapters
https://testbankfan.com/product/information-technology-project-
management-9th-edition-schwalbe-test-bank/
https://testbankfan.com/product/information-technology-project-
management-8th-edition-kathy-schwalbe-solutions-manual/
https://testbankfan.com/product/information-technology-project-
management-7th-edition-kathy-schwalbe-solutions-manual/
https://testbankfan.com/product/information-technology-project-
management-7th-edition-kathy-schwalbe-test-bank/
Information Technology Project Management Revised 6th
Edition Schwalbe Test Bank
https://testbankfan.com/product/information-technology-project-
management-revised-6th-edition-schwalbe-test-bank/
https://testbankfan.com/product/information-technology-project-
management-8th-edition-kathy-schwalbe-test-bank/
https://testbankfan.com/product/information-technology-project-
management-4th-edition-marchewka-solutions-manual/
https://testbankfan.com/product/information-technology-project-
management-5th-edition-marchewka-solutions-manual/
https://testbankfan.com/product/information-technology-project-
management-4th-edition-marchewka-test-bank/
Information Technology Project Management, Ninth Edition 7-1
Chapter Objectives
• Develop a justification for project cost management and its importance in achieving
project success
• Explain basic project cost management principles, concepts, and terms
• Describe the process of planning cost management
• Discuss different types of cost estimates and methods for preparing them
• Using an example of an information technology (IT) project, list and describe the
processes of determining a budget and preparing a cost estimate
• Justify the use of earned value management and project portfolio management to assist in
cost control
• Describe how project management software can assist in project cost management
• Discuss considerations for agile/adaptive environments
Instructor Notes
The Importance of Project Cost Management
Cost management is a trouble spot for IT project managers who are not interested in the
subject. Most senior managers who make IT project decisions know more about cost issues
than they do about technology, so project managers need to learn to speak the language of
cost management. If students have had previous courses in accounting or finance, ask them to
help explain some of the basic principles of cost management that all professionals should
understand.
Planning cost management, similar to planning schedule management, is the first step in this
knowledge area. The main output is a cost management plan. As you can see, every
knowledge area now includes a process to plan for that knowledge area.
Estimating Costs
Few students have created cost estimates. Table 7-1 provides a good summary of the types of
cost estimates. Summarize the cost estimating tools and techniques, and then show students
the sample estimate that is based on the opening case. If you have another sample cost
estimate, show it to students to help them understand what an estimate looks like and how it
is prepared. Stress that there are several ways to create cost estimates, and many resources
are available on this topic.
Controlling Costs
An important part of a project manager's job is controlling project costs. Discuss the
integrated change control systems described in Chapter 4, as well as standard reports that
show a project’s budgeted and actual costs. Then plan to spend a fair amount of time
explaining earned value management. Students may become confused by the many acronyms
involved. Help students memorize the formulas in Table 7-4 and then work through a few of
the examples that are provided in the text. Explain that although earned value management
makes perfect sense in theory, it is difficult to implement in most projects. The government is
a strong proponent of earned value management, and more and more private companies are
starting to use this technique to help manage projects and control costs. Show the results of a
recent study on the percentage and types of projects using earned value management (Figure
7-6). An increasing number of organizations are also using project portfolio management.
AgileEVM is an adapted implementation of EVM that uses the Scrum framework artifacts as
inputs, uses traditional EVM calculations, and is expressed in traditional EVM metrics.
AgileEVM requires a minimal set of input parameters:
• Actual cost of a project
• An estimated product backlog
• A release plan that provides information on the number of iterations in the release
and the assumed velocity.
All estimates can be in hours, story-points, team days or any other consistent estimate of size.
The critical factor is that it must be a numerical estimate of some kind.
Classroom Activities
1. Earned Value
Have students complete Exercise 1 during class. Make sure they know how to perform
earned value calculations and interpret the results.
Troubleshooting Tips
Go through several examples in this chapter. Have students complete earned value exercises
during class and make sure they understand this concept of project cost management.
Students often want to do more hands-on activities, so let them use Excel or Project 2016 to
prepare some cost estimates in class or at home. Using Project 2016 to handle cost and
human resources data can be cumbersome, so review the appropriate section of the Appendix
with the class beforehand. Warn students that if you assign resources to a task, Project 2016
assumes that the resources are full time. In real life, project tasks are usually not assigned
full-time resources.
Quick Quiz
1. What is a black swan project? ANSWER: One with a huge overrun.
2. Suppose you sell ten widgets per day on average, and the average cost per widget is $10.
If you sold eleven widgets in one day, what would the effect on profits be?
ANSWER: There is not enough information to answer this question. You are given costs
and asked to estimate profits. You do not know what the average profit is per widget.
You might lose money by selling more widgets.
3. What is the formula for calculating cost variance?
ANSWER: EV-AC
Information Technology Project Management, Ninth Edition 7-4
Discussion Questions
1. Why do you think it’s difficult to understand some of the basic cost terms in this chapter?
Why aren’t many technical people interested in cost-related subjects? What could be
done to change this?
2. Suppose you were asked to prepare a cost estimate for a project to purchase laptops for
all faculty and staff at your college or university. How would you start? How long would
it take you to prepare a good estimate? What type of estimate would you prepare, and
what approach would you use to develop a cost estimate?
3. What can organizations do to ensure that estimates are good? What can they do to
prevent cost overruns?
Key Terms
actual cost (AC) The total of direct and indirect costs incurred in accomplishing work on an
activity during a given period
analogous estimates A cost-estimating technique that uses the actual cost of a previous, similar
project as the basis for estimating the cost of the current project; also calledtop-down estimates
budgetary estimate A cost estimate used to allocate money into an organization’s budget
cash flow analysis A method for determining the estimated annual costs and benefits for a
project
contingency reserves Dollar amounts included in a cost estimate to allow for future situations
that may be partially planned for (sometimes called known unknowns) and that are included in
the project cost baseline
cost baseline A time-phased budget that project managers use to measure and monitor cost
performance
cost performance index (CPI) The ratio of earned value to actual cost; can be used to estimate
the projected cost to complete the project
cost variance (CV) The earned value minus the actual cost
Information Technology Project Management, Ninth Edition 7-5
definitive estimate A cost estimate that provides an accurate estimate of project costs
direct costs Costs that can be directly related to creating the products and services of the project
earned value (EV) An estimate of the value of the physical work actually completed
estimate at completion (EAC) An estimate of what it will cost to complete the project based on
performance to date
function points Are a means of measuring software size based on what the software does for
end users. Function points are comprised of inputs, outputs, inquiries, internal data, and external
interface data.
indirect costs Costs that are not directly related to the products or services of the project, but are
indirectly related to performing the project
intangible costs or benefits Costs or benefits that are difficult to measure in monetary terms
known unknowns Dollar amounts included in a cost estimate to allow for future situations that
may be partially planned for (sometimes called contingency reserves) and that are included in the
project cost baseline
learning curve theory A theory that when many items are produced repetitively, the unit cost
of those items normally decreases in a regular pattern as more units are produced
life cycle costing The total cost of ownership, or development plus support costs, for a project
management reserves Dollar amounts included in a cost estimate to allow for future situations
that are unpredictable (sometimes called unknown unknowns)
overrun The additional percentage or dollar amount by which actual costs exceed estimates
planned value (PV) The portion of the approved total cost estimate planned to be spent on an
activity during a given period
project cost management The processes required to ensure that the project is completed within
the approved budget
rate of performance (RP) The ratio of actual work completed to the percentage of work
planned to have been completed at any given time during the life of the project or activity
reserves Dollar amounts included in a cost estimate to mitigate cost risk by allowing for future
situations that are difficult to predict
rough order of magnitude (ROM) estimate A cost estimate prepared very early in the life of a
project to provide a rough idea of what a project will cost
schedule performance index (SPI) The ratio of earned value to planned value; can be used to
estimate the projected time to complete a project
schedule variance (SV) The earned value minus the planned value
tangible costs or benefits Costs or benefits that can be easily measured in dollars
three-point estimate Involves estimating the most likely, optimistic, and pessimistic costs for
items.
to-complete performance index (TCPI) A measure of the cost performance that must be
achieved with the remaining resources to meet a specific goal, such as the BAC or EAC
top-down estimates A cost-estimating technique that uses the actual cost of a previous, similar
project as the basis for estimating the cost of the current project; also called analogous estimates
unknown unknowns Dollar amounts included in a cost estimate to allow for future situations
that are unpredictable (sometimes called management reserves)
Another random document with
no related content on Scribd:
banquette her own se’f. I done seed her, one mornin’; she war a-
scrubbin’ lak mad. An’ bress yer, honey, she done had a veil on; so
no one won’t know her. Shore’s I live, she done brick her banquette
wid a veil on.”
“If she cleans the banquette herself, they must be very poor,” was
Pepsie’s logical conclusion. “Perhaps, after all, they’re not so proud;
only they don’t want people to know how poor they are. And, Tite,
don’t you tell that on the poor lady. You know it’s just one of your
stories about her having a veil on. It may have been some one else.
You couldn’t tell who it was, if she had a veil on, as you say.”
This argument did not in the least shake Tite Souris in her
conviction that she had seen the granddaughter of the Count
d’Hautreve bricking her banquette before “sun-up” with a veil over
her face.
However, Lady Jane and Pepsie were reconciled, and the little
cripple, to show her confidence in the child’s affection, was now as
anxious to have her go to Mam’selle Diane and learn music, as she
was averse to it before.
“Yes, Lady dear, I want you to learn to play on the piano, and I’ll
tell you what I’ve been thinking of,” said Pepsie as they leaned
confidentially toward each other across the table, “mama has some
money in the bank. She’s been saving it to get something for me.
You know, she does everything I want her to do. I wanted to learn to
read, and she had a teacher come to me every day until I could read
and write very well, so I’m sure she’ll do this, if I want her to; and this
is what it is: She must buy a piano to put right there in that space
next to bed.”
“For me to play on? Oh, Pepsie, how lovely!” and Lady Jane
clasped her hands with delight.
“And you can practise all the time,” continued the practical Pepsie.
“You know, if you ever learn music well you must practise a great
deal. Cousin Marie practised three hours a day in the convent. And
then, when you are grown up, you’ll sing in the cathedral, and earn a
great deal of money; and you can buy a beautiful white satin dress,
all trimmed down the front with lace, and they will ask you to sing in
the French Opera, on Rue Bourbon; and every one will bring you
flowers, and rings and bracelets, and jewels, and you’ll be just like a
queen.”
“And sit on a throne, and wear a crown?” gasped Lady Jane, her
eyes wide and sparkling, and her cheeks flushed over the glories of
Pepsie’s riotous imagination.
“Yes,” said Pepsie. Now that she had started she meant to give full
rein to her fancy. “And every one will be ready to worship you, and
you’ll ride out in a blue carriage, with eight white horses.”
“Oh, oh!” interrupted Lady Jane rapturously; “and you’ll go with
me, and it will be just as good as riding in Tante Modeste’s milk cart.”
“Better, much better,” agreed Pepsie, quite willing, in her present
mood, to admit that there was something better; “and then you’ll
have a big, big house in the country, with grass, and trees, and
flowers, and a fountain that will tinkle, tinkle all the time.”
“And you and Mama Madelon will live with me always.” Here a
sudden shadow passed over the bright little face, and the wide eyes
grew very wistful. “And, Pepsie, perhaps God will let papa and mama
come and live with me again.”
“YES, LADY DEAR, I WANT YOU TO LEARN TO PLAY ON THE
PIANO, AND I’LL TELL YOU WHAT I’VE BEEN THINKING OF,” SAID
PEPSIE
“Perhaps so, dear,” returned Pepsie with quick sympathy. “When I
say my prayers, I’ll ask.”
Presently Lady Jane said softly, with an anxious glance at Pepsie,
“You know, you told me that mama might come back before
Christmas. It’s nearly Christmas, isn’t it? Oh, I wish I could know if
she was coming back! Can’t you ask your cards, Pepsie? Perhaps
they’ll tell if she’ll come.”
“I’ll try,” replied Pepsie, “yes, I’ll try; but sometimes they won’t tell.”
When Lady Jane asked permission of Madame Jozain to study
music with Mam’selle Diane, Tante Pauline consented readily. In fact,
she was overjoyed. It was no common honor to have one’s niece
instructed by a d’Hautreve, and it was another feather in her much
beplumed cap. By and by people would think more of her and treat
her with greater consideration. When she was once intimate with the
d’Hautreve ladies, the neighbors wouldn’t dare turn the cold shoulder
to her; for through their interest in the child she expected to gain a
foothold for herself; but she had yet to learn how very exclusive a
d’Hautreve could be, under certain circumstances.
CHAPTER XVII
LADY JANE’S DANCING-MASTER