Cost build up estimation in projects

Abstract

Cost estimation is a critical aspect of the projects management that involves predicting the likely cost of the projects and determining its feasibility based on available resources and constraints. In this wiki article, we will try to get a holistic view of the factors that affect the costs of the projects and present the cost estimation techniques and practices that can be applied to ultimately get it as close as possible to the actual cost of each project. There is a general view that the accuracy of cost estimates is crucial to all parties involved with the projects. As a result, it is very important to analyze the factors that affect the estimation cost. There are many, but a few of the most important ones are the complexity of the project, scale and scope of the project, time, effort, market conditions, if there is an accurate plan for the project and if the tasks are clarified, experience on the methods that required to be applied, the location and accessibility of the project, the financial situation of the client. Moreover, in order to improve estimation accuracy, we must collect all the information about the factors and in conjunction with the estimation techniques, models and methodologies we will manage to make the estimation process more accurate and easier. To conclude, cost estimation is a crucial component of project management that ensures that tasks are completed on time and within budget, alternatively companies may be severely harmed from the impact of incorrect cost estimates on their finances. Project managers can make good decisions and complete their projects efficiently if they are well aware of the variables that affect cost, have a good understanding of cost estimating techniques and the importance of cost control and monitoring.