What tool have project managers come to use to identify all of the costs associated with a project?

Choice A. 

A Work Breakdown Structure!

Thank you for invitation. I think option A is good answer.

Iwillapproachthisanswermakinganintroductiontothedifferenttopics, sotobetterunderstandtheanswer. AsallthesetermsarerelatedtoProjectManagement (PM) andveryusefultoolslet’sgothrougheachofthem:

WorkBreakdownStructure (WBS)

Aworkbreakdownstructure (WBS) isakeyprojectdeliverablethatorganizestheteam'sworkintomanageablesections. TheProjectManagementBodyofKnowledge (PMBOK) definestheworkbreakdownstructureasa "deliverableorientedhierarchicaldecompositionoftheworktobeexecutedbytheprojectteam." Theworkbreakdownstructurevisuallydefinesthescopeintomanageablechunksthataprojectteamcanunderstand, aseachleveloftheworkbreakdownstructureprovidesfurtherdefinitionanddetail. Aneasywaytothinkaboutaworkbreakdownstructureisasanoutlineormapofthespecificproject. Aworkbreakdownstructurestartswiththeprojectasthetopleveldeliverableandisfurtherdecomposedintosub-deliverablesusingthefollowingoutlinehierarchy.

Theprojectteamcreatestheprojectworkbreakdownstructurebyidentifyingthemajorfunctionaldeliverablesandsubdividingthosedeliverablesintosmallersystemsandsub-deliverables. Thesesub-deliverablesarefurtherdecomposeduntilasinglepersoncanbeassigned. Atthislevel, thespecificworkpackagesrequiredtoproducethesub- deliverableareidentifiedandgroupedtogether. Theworkpackagerepresentsthelistoftasksor "to-dos" toproducethespecificunitofwork. Ifyou'veseendetailedprojectschedules, thenyou'llrecognizethetasksundertheworkpackageasthe "stuff" peopleneedtocompletebyaspecifictimeandwithinaspecificlevelofeffort.

Fromacostperspective, theseworkpackagesareusuallygroupedandassignedtoaspecificdepartmenttoproducethework. Thesedepartments, orcostaccounts, aredefinedinanorganizationalbreakdownstructureandareallocatedabudgettoproducethespecificdeliverables. Byintegratingthecostaccountsfromtheorganizationalbreakdownstructureandtheproject'sworkbreakdownstructure, theentireorganizationcantrackfinancialprogressinadditiontoprojectperformance.

Somewidely-usedreasonsforcreatingaWBSinclude:

• Assistswithaccurateprojectorganization
• Helpswithassigningresponsibilities
• Showsthecontrolpointsandprojectmilestones
• Allowsformoreaccurateestimationofcost, riskandtime
• Helpsexplainthe projectscope tostakeholders

SomelinkstogodeeperintotheBWSconcept:

http://www.workbreakdownstructure.com

http://www.brighthubpm.com/templates-forms/2645-what-is-a-work-breakdown-structure/

https://www.projectsmart.co.uk/work-breakdown-structure.php

Ganttchart

AGanttchart, commonlyusedinprojectmanagement, isoneofthemostpopularandusefulwaysofshowingactivities (tasksorevents) displayedagainsttime. Ontheleftofthechartisalistoftheactivitiesandalongthetopisasuitabletimescale. Eachactivityisrepresentedbyabar; thepositionandlengthofthebarreflectsthestartdate, durationandenddateoftheactivity. Thisallowsyoutoseeataglance:

• Whatthevariousactivitiesare
• Wheneachactivitybeginsandends
• Howlongeachactivityisscheduledtolast
• Whereactivitiesoverlapwithotheractivities, andbyhowmuch
• Thestartandenddateofthewholeproject

Tosummarize, aGanttchartshowsyouwhathastobedone (theactivities) andwhen (theschedule).

Forfurtherinformationandsamplesyoumaycheckthefollowinglinks:  http://www.gantt.com/index2.htm?utm_expid=11664174-46.EjGD5xWgTOia25IJzkiv2w.2&utm_referrer=https%3A%2F%2Fwww.google.ae%2F

https://www.mindtools.com/pages/article/newPPM_03.htm

http://creately.com/blog/diagrams/use-gantt-chart-plan-project/

BillofMaterials (BOM)

Thebillofmaterialsdefinesthecompletesetofmaterialsrequiredinordertocreateaproduct.

TheBOMcanbeintheformofatreewithmultiplelevels. Itcanalsobeinadocumentformatwhichisindentedtothelowestlevelrequired, sothatitaccuratelylistsallpartsandrawmaterialsneededtomakethespecifiedproduct.

TheBOMisthenusedbytheprojectmanagerand/orpurchasingdepartmenttoorderanysupplieswhicharenecessaryfortheproject.

MoreinformationaboutBOMcanbefoundintheselinks:

http://project-management-knowledge.com/definitions/b/bill-of-materials-bom/

https://en.wikibooks.org/wiki/Project_Management_Institute_(CAPM-PMP)

ArrowDiagramNetwork

Thearrowdiagramnetworkshowstherequiredorderoftasksinaprojectorprocess, thebestschedulefortheentireproject, andpotentialschedulingandresourceproblemsandtheirsolutions. Thearrowdiagramletsyoucalculatethe “criticalpath” oftheproject. Thisistheflowofcriticalstepswheredelayswillaffectthetimingoftheentireprojectandwhereadditionofresourcescanspeeduptheproject

Usefulinformationaboutarrowdiagramscanbefoundhere:

http://www.cpmtutor.com/c02/arrowdiagram.html

http://asq.org/learn-about-quality/new-management-planning-tools/overview/arrow-diagram.html

http://www.brighthubpm.com/project-planning/12712-connecting-a-projects-parts-with-a-network-diagram/

MY ANSWER

Now I will link these concepts, these PM tools, in order to provide my answer.

When planning your project, always together and with the support of your team, the first step is to identify the work packages of your project: from main top and big activities, to decompose them into smaller and smaller ones. For each one of those bits of activities, to identify all the requirements in terms of time, human resources, supplies (materials, sw, tools, etc.), etc. And based on those requirements to make an estimation of the costs.

So, yes, the first tool to identify your project costs is the WBS.

But I would not close my answer with just this first step.

These activities are linked through an arrow diagram network in order to reflect the interdependencies of the project. These interdependences may lead me to some extra costs that I should consider. Especially when it comes to risk management – if I foresee that there is a big risk for one activity to be delayed I may consider some mitigation costs, as an example.  So, establishing the links between different activities it is also a way to review or consider some project costs.

In a following step I would raise the Gantt chart leveraging in the WBS and the arrow diagram network. This will help me to realize about the whole project flow, involving all the activities. I would use this tool to revisit my costs once I have prepared this visual view about the project.

The BOM is the specification of all the materials I need for my project to run. These should have been included in the WBS, though a documented BOM it will make me sure that I have quoted every single material that is needed in my project budget.

SUMMARY: The main tool to identify your project costs is the WBS, though I will always make use of Gantt Charts, BOMs and arrow charts as a check point to review my costs and make sure all are considered.    

Without any doubt it is WBS of course.

In my opinion - A. A work breakdown structure.

My answer is for option C. A bill of materials