The key to effective cost management is to enable clients’
requirements to be detailed and the scope of works fully identified
and costed within the project cost plan.
The cost plan is the platform or baseline for controlled design
development and provides an essential tool to enable projects to be
delivered within budget. As well as being a key document, the
process of developing a cost plan often highlights areas of risk
and uncertainty and may well help clarify the team’s thinking on
issues of scope, specification and programme all of which affect
the cost.
Where clients require a risk analysis, this can be undertaken to
establish a likely out turn cost and to develop a risk mitigation
plan. The plan can be used through the whole life cycle of the
project including bring into use, rectifying any defects, and if
appropriate the operational costs of the asset.
By utilising the plan during all phases of the project, but in
particular during design development and the procurement process,
the document can be used to ensure that costs are managed rather
than just reported.
Accurate and impartial advice is essential if costs are to be
managed and reported to enable the client to take proactive steps
as issues develop, rather than as is all too often the case, react
once the money has been spent and avenues to mitigate over
expenditure are limited.
An essential element of successful cost control is the strict
administration of change control procedures throughout all stages
of the project from initial budgets, during the design stage and
throughout construction.
