How to create a plan to monitor time&cost of subcontracted project

[Jaishree]

Hi,

There is a project which has been budgeted and the project is subcontracted.
Based on the completion of tasks on time by the subcontractor specific
percentage of the total budgeted amount is awarded to the contractor. If the
time to complete the task is delayed a specific percentage is deducted from
the total budgeted cost.

Subcontractors send the update on the completion of the task and the date of
completion to an identified person who will be the assignment owner of the
tasks for the projects and feeds the data.

How should we plan a project for the above?
Should we have fixed cost for tasks, if so where can the actual cost for a
task be captured?

Please help.

Please help in creating a project plan.

 

[Jaishree]

Hi Trevor,

Thanks a ton for your quick and valuable reply.

Thanks & Regards,
Jaishree

Presumably, the entire cost of the subcontracted Tasks, both labour and
materials, ie what is paid to the subcontractor, is a fixed amount (at least
to start with, before deductions) and you are not concerned about the number
of Work (man) Hours. If you don't want Hours and you don't have a Duration
dependent Cost, you don't want a Work Type Resource.
You could use Fixed Cost of the Tasks or, and I think this is better, you
could make the subcontractor Resource a Material Type Resource with a fixed
Standard Rate, eg $10000 rather than an hourly or daily rate.
If there is more than one Task, it might be better to have Subcontract
Resource #1, Subcontract Resource #2, etc, and assign each one to just one
specific Task and split the total Cost between Subcontract Resource #1,
Subcontract Resource #2, etc.

Actual Cost goes in the Actual Cost Column regardless of whether you use
Fixed Cost for the Task or assign the Material Type Subcontract Resource(s).
Use the Cost Table to see Fixed Cost and Cost related fields.
You will probably have to use Tools, Options, Calculation to set MSP not to
calculate Actual Cost based on Duration.

If you use Fixed Cost or the Material Type Subcontract Resource(s), have a
look at how you will accrue them. It is more conservative and smarter to
accrue the Cost at the start of the Task rather than pro-rata or at the end
because it pushes your Cost S Curve (Cumulative Cost Curve) to the left and
when you come to design progress claims from your client you will base them
partly on a need to stay cash-flow positive even with a severe (early)
Cumulative Cost accrual.

If you use Fixed Cost, make sure you apply it only to Tasks, not Summaries.
This applies for everything, Resource Assignments, Predecessors, Successor
etc - on Tasks only, not on Summaries.

Trevor Rabey 0407213955 61 8 92727485 PERFECT PROJECT PLANNING
www.perfectproject.com.au