Cost and Scheduling Basic

Posted: October 17th, 2013

Cost and Scheduling Basic

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Cost and Scheduling Basic

Cost and scheduling are important factors that contribute to the success of any business entity. They should not be underestimated, but unfortunately, many companies tend to neglect them. This is because they play a significant role in expanding the project’s strategy and processes so that goals are achieved. When a firm takes up a project, they need to consider many factors to make it a success. Change is inevitable when one is in business, and thus one needs to be ready for it. There are times that a company will need to restructure the organization to ensure they have achieved the set objectives. In such an occasion, they will need to reflect on its options and make sure that the benefits compensate the costs. Before they consider whether to change how it operates because of a project, they also need to look at other factors (Taylor 2008).

First factor to look at before organization restructure is how viable will the project be if undertaken. Some projects will not give a company enough returns when undertaken. It would be better for a company to forego the project, as the opportunity cost is not profitable. If a company chooses to take up the challenge, then they should ensure that they have appointed a qualified project manager conversant with project management life cycle. The project manager will come up with a risk management plan that will help minimize any perils that they might face during the restructure. A risk management plan will help determine whether it is worth it to take up the project.

The cost of restructuring should also be considered. When in business, a company’s top objective is to make profits. If the cost of production exceeds profit made the company might run out of business. Thus, a firm would look to make sure that its costs are minimized. If restructuring means that the company might get a loss, then it should be avoided. Rather they can look for ways to restructure at minimal costs, or find a way to do the project without interfering with the organization’s structure. This change should also be beneficial to the company not only now but also in the future as well.

Organizations are made up of human beings that form a structure that has a hierarchy from top managers, middle-level management, supervisors and workers. To restructure an organization would mean to change how the personnel think and relate to one another. The process would involve learning a new way of viewing the company’s operations and would require the staff to have a clear and open communication lines. Employees and laborers acceptance of the new changes is essential. A company should therefore make sure that they are on the same page with its personnel so that there is a smooth transition. If the employees are resistant to change, the whole process will be a flop. A company should have access to the necessary training associated with the structure (Hecksher 1988).

All in all a company will need to weigh out its options before considering whether to restructure its organization. The good thing is with the changing faces of the business world they can choose to restructure part of the company. This is a new trend where a project is allocated a manager and a team. The sole purpose of this team is to tailor their skills to fit the needs of the project. This way a company does not need to change with each project that comes along. Once the project is completed, the team can be given a new project to manage. In addition, the costs incurred when using this method are not as expensive as changing the whole organization. At the end of the day, what every company wants is continuity. Thus, they will have to go the direction their clients want them to go to survive the market.

Reference:

Dess, G. G. (2012). Strategic management: Text and cases. New York: McGraw-Hill/Irwin.

Heckscher, C. C. (1988). The new unionism: Employee involvement in the changing corporation. New York: Basic Books.

Taylor, J. (2008). Project scheduling and cost control: Planning, monitoring and controlling the baseline. Ft. Lauderdale, Fla: J. Ross Pub.