Nothing is worse on a project than not to have an accurate, up-to-date view of the current costs. The key to rigorous cost control of current costs on a project lies into the management of commitments. Our White Paper 2012-05 looks into the reasons, what it entails, and how to successfully record and manage commitments.
The worst nightmare for cost control: stacks of invoices without commitments!
Controlling commitments is not a standard accounting practice, yet it is indispensable in projects, because projects are not processes where the future can be inferred from the past. Because there are delays in receiving invoices, poor following up commitments lead to significant offsets in the project’s forecast.
The paper goes on to explain how to effectively control commitments, how to enforce discipline on the matter, and how it all ties up with accounting.
Controlling commitments is the first key to effective Project Controls. As a sequel, a second White Paper (2012-06 “No Surprises: the Recipe for Consistent Project Controls”), addresses the issue of accurate forecasting of future cost.
Read White Paper 2012-05, “How to Be On Top of Your Costs: the Art of Mastering Commitments“.
