Here’s Why Your Projects Always Cost More Than You Think

Collaborative post – may contain affiliate links

When you and your team plan a project, you imagine that you’ll move from where you are now to where you want to be in a linear fashion. After all, that’s what seems most reasonable. 

The problem is that the world doesn’t move linearly in business projects (or in pretty much every other field for that matter). We like to believe that change is a straight line, but it usually does a few loop-the-loops on the way. 

Just look at the stock market. Over fifty years, you can say that the stock market goes up, on average, about 7 percent per year. Not bad. But if you look at any single year, you can have enormous variation. Some years it’s down by 40 percent, others it’s up by more than 20. The world doesn’t move in a straight line, and neither will your projects. 

The good news is that you can do a lot to make sure that your project doesn’t cost more than you think. There are ways around this seemingly intractable issue: it just takes a little thought. You need to fundamentally change the way you see the world and becoming more accepting of the chaotic nature of reality. 

Reason #1: Your Estimates Are Way Off

We all like to think that we can plan cost estimates for our projects, whether they are construction projects, new products, or organizational redesign. Projects are just something that we “have to get on with.” Once the ball is rolling, milestones will fall like dominoes. 

What’s strange about this mentality is that we all know it’s wrong from our past experiences. Very few of us have ever had the luxury of working on a project which progresses effortlessly from one step to the next. There’s always a problem. And those problems always result in higher costs. 

Quality estimation services can help you calculate your costs better. Most are sophisticated enough these days to ascribe a probability range for prices, instead of an actual figure. Costs that nobody foresaw can come out of nowhere and change the nature of the game. 

Reason #2: Your Project Is Not Effectively Managed

Working out how much it’s going to cost to design a project and hire the people to implement it is one thing. Organizing people correctly is quite another. A substantial part of risk site risk management is choosing and coordinating contractors. It’s not easy to pick up if you’ve never done it before. You need professionals on-site who know what they’re doing and who have experience interacting with various stakeholders. 

Reason #3: You Have Administration Issues

The people administering your project need to understand what stage you’re currently at. You might think that you’re in control of the situation on the ground, but if your admin people don’t know anything about your progress, then they could make mistakes. 

The best way around this is to provide admin with project management tools. If they see the stage that you are in, they are in a better position to provide proactive support.

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