How do you handle cost changes and claims in cost planning?

2 Monitor and control the costs

The second step to handle cost changes and claims is to monitor and control the costs of your project. You need to track the actual costs against the planned costs, identify and analyze any variances, and take corrective actions if needed. You also need to update and revise your cost plan and forecast regularly, based on the changes in scope, schedule, quality, resources, and risks. By monitoring and controlling the costs, you can ensure that your project is on track, on budget, and on value.

3 Communicate and document the changes

The third step to handle cost changes and claims is to communicate and document the changes that affect your project. You need to inform and consult with your client, team, and stakeholders about any changes in scope, schedule, quality, resources, and risks that may impact the cost plan and report. You also need to document and record the changes, including the reasons, approvals, impacts, and actions taken. By communicating and documenting the changes, you can avoid misunderstandings, disputes, and claims.

4 Manage the claims

The fourth step to handle cost changes and claims is to manage the claims that may arise from your project. You need to review and evaluate the claims, based on the facts, evidence, and contract. You also need to negotiate and resolve the claims, using the appropriate methods, such as mediation, arbitration, or litigation. By managing the claims, you can protect your rights, interests, and reputation.

5 Learn and improve

The fifth step to handle cost changes and claims is to learn and improve from your project. You need to collect and analyze the feedback, lessons learned, and best practices from your project. You also need to apply the learning and improvement to your future projects, by enhancing your cost planning and reporting skills, processes, and tools. By learning and improving, you can increase your efficiency, effectiveness, and excellence in cost planning.

6 Follow the standards

The sixth step to handle cost changes and claims is to follow the standards of cost planning and reporting. You need to adhere to the ethical, professional, and technical standards of your industry, organization, and client. You also need to comply with the legal, regulatory, and contractual standards of your project. By following the standards, you can ensure the quality, accuracy, and reliability of your cost planning and reporting.

7 Here’s what else to consider

This is a space to share examples, stories, or insights that don’t fit into any of the previous sections. What else would you like to add?