What is the importance of Time and Cost in any Ongoing Project?

Time: When the project is delayed, cost of project goes up ( manpower cost, inflated material cost etc) and consequently NPV or benefit/cost ratio or IRR( Internal rate of return)  takes a downward trend.

Cost:  When the cost goes up, you have to arrange additional financing which may delay the project and push the cost further higher and finally again NPV or benefit cost ratio or IRR goes down. 

Thank you for the invitation. I agree with the answers shared by the experts!

The time and cost are crucial factors of projects success

For time, all your clients are concerned about time delivery for projects.. the shift in time means carrying additional cost and losses and faster delivery mostly will lead to savings and reputations reward

For cost, as stated by previous answers if the project is related to materials with vary prices or resource intensive the shift in time could undermine the whole project viability 

Project management literature talks about the need to measure and control all three variables of the project – Time, Quality, and Costs (or budget). Most project managers would tell from their experience that there are inherent conflicts between these variables. In many situations, when people try and speed up projects, they invest in additional resources, making the budget go haywire. While in many other situations, scope or quality is compromised to get a delayed project back on track. The conflict is also the other way round; when managers try and control budgets, time takes a backseat. (Long rounds of negotiation with multiple vendor cause significant delays in purchase items). Similarly, people try to scope in more in a particular project in order to meet the “real” needs of the client, thus compromising on time and budget. (for example, specific unplanned features that will help the client use the software more effectively!!).

With this experience, the need to monitor and control these three variables evolved – so that there is no compromise on either of them. Good project management is to ensure that all the three variables meet the standards defined in the original commitment. This would entail that all the three factors must be monitored and controlled. Right?

This is a widely accepted theory. But in the real time scenario, no effective solution has been developed to deal with the associated conflicts. It becomes very complex for a manager to derive the optimum from all the three variables. For example, how much more time can one afford to spend on negotiating a cheaper deal with the vendor, without compromising on project delivery. The extra time spent in negotiation may be recovered later or it might not be. One can only check the efficacy of the decision in hindsight. In taking decisions at runtime, some managers make a choice between what is visibly getting compromised at that point in time or wherever there is maximum pressure for control. As a result many mangers find themselves focusing too much on one variable during one phase of the project and then focusing on the other in the next phase. For example, in many E&C projects, costs are controlled very strictly during the initial part of the project while time slips away and towards the end of the project, people spend a lot to get the project back on track. Similarly, in a software environment, you can find many scope compromises close to an important release date. In a shutdown project, many scoped items will be skipped at the end, when it becomes obvious that the due date is in jeopardy.

Thus we can conclude that attempting to manage all three variables together does not help. It adds to the complexity and encourages compromises all throughout the project. In the end, none of the variables are satisfactorily managed; people invariably look at compromises made on some of the variables and then conclude that they have to focus on all the three. Well focus on many, actually means no focus.

To find a better solution, we need more understanding on how the variables are related to each other. Many would claim that they all are negatively co-related. To be good with one means to be bad with the other. It is almost like trying to keep all the ping-pong balls simultaneously under water in a swimming pool. You get one down, the other moves up. Right?

The time affect the costs of any project more time increased human and material costs, which affect negatively on the project

And vice whenever the lack of time decreased costs

I agree with the given answers from the experts.