Question

what are the strengths and the weaknesses do you think about project cost forecasting? write your answer in 200 words .

Answer 1

Project cost forecasting is an important part of project analysis and evaluation. The forecasting helps to know the cost estimate for the project. The project manager and the sponsor can take the decision whether the project is worth pursuing or not. It gives management the sense of return on investment in an project. The forecast helps to assess the project progress from time to time and in case cost goes beyond the prescribed level for an activity or phase, immediate feedback can be shared with the team. It helps to control the overall project cost and give insight to team. However, there are weaknesses associated with cost forecasting. The forecasts are never 100% accurate and the cost estimate is way different from the actual spend. It takes lot of time to prepare the forecast and share the details. As a result, the resource gets occupied and delays the other important project activities. The forecasting becomes highly challenging and difficult at times in case of agile projects due to rapid changing requirements. In current scenario with high level of uncertain environment, forecasting is very difficult and is considered as a waste due to poor level of accuracy. Hence, forecasting has both the pros and cons.