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TOPIC: Cost Budget: does it need change control for increasing?

Cost Budget: does it need change control for increasing? 1 year 3 weeks ago #23669

  • Deepti Bhattacharya
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you customer wants to increase the authorized budget on the project. it is minor change and will not have a major impact. what should be your next step?

1) do detailed impact analysis
2) perform integrated change control
3) accept the change as it does not have major impact
4) continue doing project related work

option 2 is the right answer. But I though cost baseline changes needed ICC. management reserve is included in cost budget. so if sponsor wants to increase cost budget why would it need ICC?
Looking for other opinions

Cost Budget: does it need change control for increasing? 1 year 3 weeks ago #23681

  • Devin
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The idea with any PMP question is to attempt to eliminate two weak answers and pick between two stronger answers. When you eliminate an answer it should be for cause (that is for a good reason). Let's understand the question at a high-level and then think about options. Your customer has decided to make a change. And it SEEMS like a minor change. What's concrete in this question? That the customer wants to expand the scope. Let's look at the answers and see if anything seems like an obvious bad option:

you customer wants to increase the authorized budget on the project. it is minor change and will not have a major impact. what should be your next step?

To me #4 is a weak answer, why? This is simply ignoring the customer or sticking one's head in the sand. Is this how PM's act? No. To me #3 is a problem because this is akin to gold-plating. Big avalanches start with a few grains of sand. Just accepting changes is NOT the way to run a project. We can eliminate #3 for cause.

Now we are down to #1 and #2. It seems like both are reasonable answers, but what does detailed impact analysis get us from the question? And detailed impact analysis on what? You already ASSUMED it was minor. If it WASN'T minor why are you doing a detailed impact analysis? However, answer #2, gets you what you really want a) visibility of the change across all stakeholder groups b) assign someone to do impact analysis and risk analysis d) an independent review of whether the change provides the value, etc. Thus answer #2 seems the strongest. But does this makes sense in a holistic sense in context of the answer? Yes, the customer is requesting a change to the project (doesn't matter the size) and this would necessitate that it be discussed in the ICC and approved based on the change's value proposition to the project. Thus, we pick this answer and feel good.

Hope this helps.
The following user(s) said Thank You: Deepti Bhattacharya
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