Bottom-up and parametric cost estimation

PROJ6002 – Project Planning and Budgeting

Trimester 1/2021
National Project Management Symposium
Assessment 2
Part B: Cost and Quality Management Plans

2.3 Bottom-up cost estimation
Bottom-up cost estimation is another key cost estimation tool where the key components of the project are decomposed to the bottom level and the cost of all components is calculated individually and all are finally added for gaining the final cost estimation. This type of cost estimations consume extra time than the scheduled time because of the complexity associated and can be used at the later stage in the project budgeting and planning unlike analogous

estimation is used at the initiation stage of the project. The estimated cost of any particular section is determined on the basis of sub-tasks within every single process.

Cost Estimation
Cost in a project for different phases are calculated separately and then summed up. It all happens in this phase of cost estimation. A proper analysis is required to be conducted in the market to get a bit of an idea of the current market rates of various items related to the project. All these resources have been evaluated individually to evaluate the cost of resources.

Cost Budgeting
After the phase of cost estimation, the next phase is preparing the budget for the project.

5. Quality Management Planning
Quality management implies the correct method for guiding project manager, quality manager, and managers. Quality management deals with the quality policies and process for the projects which are answerable for compliance with records (Davidson, 2019).

Quality management in a project is done on the basis of managing all major factors in a concise method that contain enough value for money and thereby provide fruitful outcomes.

Quality Control: The process of quality control is incorporated with other connectives steps. These steps include inspection, testing and quality measurement. The project plan is properly inspected to identify its relevance to the market research. Besides that, proper testing should also be done for managing the effectiveness of the working process. Quality measurement is another key part of project management.

Conclusion
Cost and quality management planning in project planning and budgeting has been critically explained in this report. The report also described various cost estimation tools such as Analogous, bottom-up and Parametric cost estimation. This report also briefly described the project cost estimation process and various cost management planning components like resource planning cost estimating, cost budgeting and cost control. The report finally concluded by describing various stages of quality management planning starting from quality planning to quality control.