Cost and Procurement Management Plan

QSO 345 Cost and Procurement Management Plan Template

Use this template to create your own cost and procurement management plans for Milestone Five. Include all sections and tables identified in this template in your final submission. Note: This template represents only the minimum requirements. If you prefer, you can add elements to your template that you believe a project manager might find useful.

Project Cost Management

Introduction
Provide a brief summary of what your Project Cost Management Plan covers.

Cost Management Approach
Describe your cost management approach, including at what level of the WBS you will manage costs. You should also describe what method you used to estimate project costs (e.g., analogous, parametric, three-point estimate), and what types of metrics will you use to control your project costs (e.g., earned value and cost variances).

Project Costs
Estimate all costs at the level each cost will be managed according to the cost management approach section above. Provide a brief introduction of what the table covers, in addition to the WBS ID at the level the cost will be managed, the WBS name associated with that WBS ID, and the estimated cost. Remember to total all your cost estimates to create a total cost baseline.

WBS ID WBS Name Estimated Cost
Example:
1.1 Example:
Design web interfaces labor Example:
$10,500

Total Cost Baseline $
Table 1, Project Cost Breakdown

Reporting Format
Describe how costs will be reported throughout the project, how the reports will be sent, what the reports will cover, and what the reporting frequency will be.

Cost Variance Response Process
Describe your cost management approach, including the thresholds you have set on each of the cost metrics described in the cost management approach (e.g., cost variance). Also describe what happens if a cost metric goes above or below your defined thresholds.

Cost Change Control
Explain the cost change control process and how requests for changes to costs will be handled.

Project Budget
Provide a breakdown of the project budget by category (e.g., labor, materials). Note that your total budget should be based on your estimated costs plus contingency and management reserves. Remember to briefly describe what your budget table covers and create a total budget figure. Your total should match your budget estimates in your Project Charter. Example:

Budget Category Cost Estimate Contingency Reserve Management Reserve Total Budget
Example:
Labor Example:
$100,000 Example:
$50,000 Example:
$10,000 Example:
$160,000

Total Budget $
Table 2, Project Budget Breakdown

Project Procurement Management

Introduction
Provide a brief summary of what your project procurement management plan covers.

Definition of Procurements
Provide a brief summary of what is covered in your procurement table, which should cover the procurements needed, the justification for each procurement, when the procurement should be completed, and who can approve the procurement. Example:

Item/Service Justification Needed by Approval
Example:
New Servers Example:
New servers are required to handle the new website load Example:
July 2016 Example:
Jon Smith – PM
Joe Brown – IT Manager

Table 3, Needed Procurements

Contract Type
Describe the types of contracts that can be used for procurements, and detail any contract type limitations.

Cost Determination Basis
Explain the how costs will be determined for procurements (e.g., RFQ, RFI, RFP) and the process that will be used to submit the requests and vet the possible vendors.

Contract Approval Process
Define the process and the rules or guidelines required for each of the procurements to be approved.

Performance Metrics for Procurement Activities
This section should describe all metrics (e.g., product quality, on-time delivery, cost per unit) that will be used to rate the vendors being considered for each procurement. Each metric should have a rating scale (e.g., 1–3) that will be defined in this section, as well as the selection methodology that will be used for the metrics (e.g., the highest-scoring vendor should be selected).