Microsoft Project 2010 : Strategies for Analyzing Costs

In addition to schedule and resources, cost plays a significant role in each project. Often when reviewing your final project schedule, it is important to review the project costs and attempt to reduce them as much as possible. Reducing costs can provide you with more leverage during the project execution because if your original estimate is lower than the capital budget you have for the project, you can use the difference to correct problems that arise throughout execution.

Budget resources enable you to add another resource to the project summary-level task, also known as task number zero, within your project to capture the capital budget. You can use it to compare your baseline and actual total project budget to.

• Reduce resource costs

• Decrease project scope

These options are discussed in detail in the later sections.

Reviewing the Cost Table

Microsoft Project 2010 provides many different ways to review your project costs. One of the ways is to display the Resource Sheet view (select the View tab, Resource Sheet) and apply the Cost table (select the View tab, Tables, Cost). This view displays all resources in your project and their costs. To make this view even more useful, you can use sorting, filtering, and grouping to help you identify various cost categories.

For example, you can group your resources by type and then sort the list in descending order, so that the most expensive resources in each category are displayed at the top of the list. To do so, follow these steps:

1.	Select the View tab, Group By, Resource Type.
2.	Select the View tab, Sort, By Cost. This will sort the list of resources in descending order, with the most expensive resource at the top, as shown in Figure 1. Figure 1. Use the Resource Sheet Cost table, grouped by resource type and sorted by cost, to review your most expensive resources in each resource category.

Reducing the Cost of Work

One way to reduce the cost of your project is reduce the cost of work. This can be accomplished by using less-expensive resources, for example. Here are some points to keep in mind:

• If you have contractors assigned to perform some of the tasks in your project, you can replace them with employees, which are generally cheaper to use. If you decide to do this, ensure that internal resources are available for work and that you will not cause any resource overallocations.

• If you have material resources in your project, you can try to find a better deal or a cheaper source for purchasing them. Similarly, you can shop around for a better deal on the cost of services as well. Maybe it is cheaper to rent equipment instead of buying it. Look for alternatives to reduce the cost of these resource types and take into account special promotions and so on.