Schedule and Cost of Projects
Most organizations are formed for a purpose that results in producing goods or services. The success of the organization’s endeavor is in the management of resources and how the founders of the organization have structured the operation to achieve its strategic objective. Because most organizations require resources to facilitate the ability to accomplish daily tasks in the operation, on some occasions special activities are required to accomplish certain things the operation needs that are not part of the daily tasks, but require resources from within the organization. These types of special tasks are called projects, and if they are structured and managed well, they will provide opportunities for the organization to make improvements that are necessary in the ongoing improvement of the operation.
Depending on the type and size of the organization, projects may be sporadic and used only in special development situations, whereas other organizations may use projects integrated into its business structure as a main part of its daily operation. Regardless of how projects are utilized in the organization, they require resources that may include human resources, equipment and materials, facilities, and financial resources. When special projects require these types of resources, it is important to note that most of these resources are utilized in normal daily operation tasks; if they are used on a special project, they have to be allocated such that they do not impact daily operations and create conflicts. Most resources used within an organization have a cost component associated with how they are used; how a resource is expensed for a special project also is a consideration.
Organizations can generally benefit from special projects, but the structure, organization, and utilization of resources become a very important element not only in the success of the project, but in minimizing the impact to the organization and daily operations. Before a special project can be authorized, management within the organization needs to know how much the project will cost, how much of the organization’s resources will be required, what are the expected deliverables or benefit to the organization, and how long the project will take to complete. Because it is usually easier to identify how a project deliverable will benefit the organization, it can be difficult to ascertain how much the project will cost, how long it will take, and how many and what types of resources will be required to complete the project objective. At this point, project management tools and techniques can be utilized to define cost and schedule requirements.