Managing Project Cost Over Time: A Real-World Case Study in Weekly Project Spend
- Tellura
- Jul 3
- 5 min read
Updated: Aug 7
In the world of project management, tracking costs accurately and consistently is not just a financial obligation—it’s a strategic necessity. Whether you're managing a capital-intensive oil & gas project, a digital transformation initiative, or a government-funded infrastructure build, poor cost tracking can derail timelines, reduce stakeholder confidence, and threaten profitability.
Marriage is often seen as one of the most important commitments in life. When we view it through the lens of project management, especially using the PMI PMBOK Guide Edition 7, we can uncover intriguing insights about structure, planning, and execution in relationships. This blog post explores whether marriage can be classified as a project and what we can learn from established project management principles.
Project Information
Here’s a look at the cost information for a project spanning 16 weeks, with the breakdown shown below:
Project Cost Baseline
According to the PMI PMBOK® Guide (Project Management Body of Knowledge), the project cost baseline is defined as
“The approved version of the time-phased project budget, excluding any management reserves, which can only be changed through formal change control procedures and is used as a basis for comparison to actual results.”
— PMBOK® Guide, 6th Edition, Section 7.3.3.1
In Simple Terms:
The cost baseline is
The planned budget distributed over time (weeks/months).
What you compare your actual spending against.
A reference for measuring cost performance (e.g., cost variance, CPI).
Key Components of a Cost Baseline:
Time-Phased Budget (e.g., how much is planned to be spent each week/month)
Excludes Management Reserve
Includes:
Direct Costs (labor, materials, equipment)
Contingency Reserves for known risks
Used in:
Earned Value Management (EVM)
Forecasting
Performance reviews
Why It Matters:
Without a cost baseline, you can’t determine if you're under or over budget.
It’s crucial for project monitoring, forecasting, and reporting to stakeholders.
Deviations from the baseline trigger analysis and potential corrective actions.
Establishing the Project Cost Baseline
To effectively manage and control project finances, we will develop a project cost baseline using cumulative cost calculations. This approach enables us to forecast and monitor the planned expenditure at any given point during the project timeline.
By aligning the cumulative planned cost with the project schedule and scope of work, we can
Visualize how costs are expected to build up over time (e.g., higher spending during execution phases, lower during planning and closing).
Establish reference points for measuring actual performance, enabling early detection of cost overruns or underspending.
Support Earned Value Management (EVM) by providing the "Planned Value (PV)" needed to calculate metrics like Cost Variance (CV) and Cost Performance Index (CPI).
This baseline becomes a critical tool for financial control, stakeholder communication, and strategic decision-making as the project progresses.
Now let us follow some basic steps to get this done:
STEP 1: Represent the information in a vertical table format as seen below, which is the same format given above:
Week | Labor | Material | Equipment/Parts | Total |
Week 1 | 7350 | 10900 | 175 | 18425 |
Week 2 | 7350 | 0 | 0 | 7350 |
Week 3 | 7350 | 0 | 0 | 7350 |
Week 4 | 11550 | 100 | 625 | 12275 |
Week 5 | 4200 | 5800 | 0 | 10000 |
Week 6 | 4200 | 0 | 0 | 4200 |
Week 7 | 12600 | 365 | 225 | 13190 |
Week 8 | 15400 | 4320 | 0 | 19720 |
Week 9 | 2800 | 2875 | 0 | 5675 |
Week 10 | 5600 | 645 | 0 | 6245 |
Week 11 | 5600 | 0 | 0 | 5600 |
Week 12 | 5600 | 2400 | 0 | 8000 |
Week 13 | 1400 | 0 | 0 | 1400 |
Week 14 | 2800 | 300 | 0 | 3100 |
Week 15 | 2800 | 0 | 0 | 2800 |
Week 16 | 1400 | 50000 | 0 | 51400 |
STEP 2: We will now create a cumulative calculation.
I will quickly use Week 1 to explain the table above. The given information in Week 1 is
Week | Labor | Material | Equipment/Parts |
Week 1 | 7350 | 10900 | 175 |
So, the total weekly cost for week 1 will be 7,350 (labor) + 10,900 (material) + 175 (equipment/parts) = 18,425. This is how the weekly total cost is gotten for the rest of the other weeks.
For weekly cumulative cost calculation, let us see how this is done below:
Week | Labor | Material | Equipment/Parts | Weekly Total Cost | Weekly Cumulative Cost |
Week 1 | 7350 | 10900 | 175 | 18425 | 18425 |
Week 2 | 7350 | 0 | 0 | 7350 | 25775 |
In order to get the cumulative cost for Week 1, I will use the same value I got for Week 1 total cost, which is NOK 18,425.
For week 2, the cumulative cost will be week 1 (cumulative cost) + week 2 total cost = 18,425 + 7,350 = NOK 25,775.
NOTE: NOK is the currency used in Norway, just like the $ is used in the USA.
The project cost baseline—also known as the Planned Value (PV) or Budgeted Cost of Work Scheduled (BCWS)—is shown in the plot below:
Key Insights to give the Project Manager of this project
Cost Trends:
Peak Cost Periods: Week 8 and Week 16—indicating intense activity (e.g., execution or closeout).
Low Activity Weeks: Weeks 3, 6, 13, and 15—potentially good for resource optimization.
What to Manage:
Labor Costs:
Highest contributor to weekly costs in most weeks.
Ensure timesheet accuracy, contract compliance, and productivity monitoring.
Material Costs:
Watch for large purchases (e.g., Week 16, NOK 50,000).
Align procurement with the schedule and avoid overstock or delays.
Equipment/Parts:
Minimal but spiked in Week 4 and Week 7.
Coordinate delivery/usage to avoid idle rentals or delayed installations.
Total Weekly Burn:
Ranges from NOK 1,400 (Week 13) to NOK 51,400 (Week 16).
Use this data for earned value management, forecasting, and contingency planning.
Recommended PM Actions
Review trends weekly against the baseline.
Align resource planning with the cost-intensive weeks.
Validate all procurement against material cost surges.
Monitor the final project phase to avoid over-expenditure.
Share insights with finance for cash flow alignment.
From Budget to Control: Why Your Cost Baseline Should Be A Significant Compass
Project managers often treat the cost baseline as a static document—filed away after approval. In reality, however, the baseline is one of the most powerful control tools during project execution.
Think of it as your financial GPS: each week of execution reveals whether you're on track, falling behind, or spending ahead of the value earned.
Want to Know How to Use It Effectively?
In our upcoming blog, the continuation of this series, we will examine how to monitor costs weekly across labor, materials, and equipment. By comparing actual expenditures to a clearly defined cost baseline, you’ll be equipped to answer key questions such as:
Are we spending ahead of our schedule?
Is the high labor cost in Week 8 aligned with progress earned?
Can we forecast a budget overrun before it happens?
What You’ll Learn in the Next Blog:
How to establish a realistic cost baseline
Techniques to track weekly variances and trends
How to use Earned Value Management (EVM) for smarter decision-making
How to communicate cost performance to stakeholders with confidence
Whether you're managing a construction project, IT rollout, or engineering shutdown, mastering your cost baseline gives you control, foresight, and credibility.
“Curious to see how it’s done in the next blog? Hit subscribe so you don’t miss out on any great tips!”
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