Cost per task

[David M C]

A lot of our resources are on price work (ie, they get paid a set amount per
task) as opposed to day rate (a set amount per day or hour). Is Project able
to handle this without resorting to VBA? I can do the VBA if need be but it
would be nice to know if it can already do it.

 

[Jan De Messemaeker]

Hi,

Each task has the possibility of a fixed cost.
Insert the Fixed Cost columpn to enter it.
HTH

 

[Mike Glen]

Hi David,

Welcome to this Microsoft Project newsgroup

In the View/Tables../Cost table there is a column for Fixed Costs. Input
your costs there.

FAQs, companion products and other useful Project information can be seen at
this web address: http://project.mvps.org/faqs.htm

Hope this helps - please let us know how you get on

Mike Glen
MS Project MVP

 

[Steve House [Project MVP]]

In addition to the other suggestions, this is a good example where you'd use
the "cost per use" field in the resource list. That field is added to the
cost each time the resource is assigned to an individual task. A case that
came up in one of my classes was a question from a student who was a
construction contractor. He had a fellow who was a window installer who was
paid at a fixed rate of $50 per window but didn't get any other hourly or
salary compensation. You'd enter him in the resource list as "Window
Installer, std rate = 0, ot rate = 0, cost per use = $50. On this job he
had to install 10 windows. The work is entered it as a summary task,
"Install Windows", with 10 subtasks under it, a subtask for each window.
The Installer is assigned as a resource to the group of subtasks. You'll
find that the cost column for each window install task will show $50 and the
summary task will roll that up to show a total cost of $500. Personaly I
like this better than using the Fixed Cost field because IMO it is a more
accurate description of where that money is going.

 

[David M C]

Thanks for help.

All suggestions appear to work except when a given resource has some jobs on
a day rate, and some on a fixed price. As an example:

Fred Bloggs gets 80.00 to paint kitchens on JOB1.
Fred Bloggs gets £10.00/h to paint lounges on JOB2.

Using the fixed cost method, the £80.00 gets added to the £10/h. So JOB1 is
incorrect but JOB2 is correct. Using the cost per use method, Fred Bloggs
gets his £80 on JOB1, but gets nothing on JOB2.

Any more ideas?

 

[David M C]

Does Project have a view/field for total cost of a single resource throughout
the duration of a project.

Thanks

 

[Jan De Messemaeker]

Hi,

Yes. Insert the Cost line in the Resource Usage View.
HTH

 

[Mike Glen]

Hi David,

Well...the Fixed Cost field will take negative numbers. So, you could give
the 10/hr to all Bloggs' tasks, and subtract this total from the 80 and put
that into the Fixed Cost column so that the Total Cost is what you want.

Mike Glen
Project MVP

 

[Steve House [Project MVP]]

If you double click on the resourfce ID to view the resource information
you'll find the cost page has 5 possible rate tables. Each one has
standard, overtime, and cost-per-use fields. Once the resource is assigned
to a task, the task and resource usage views allow you to select which rate
table applies to that specific assignment. So use one rate table for those
tasks that have an hourly wage and another table for those tasks that are
costed based on cost per use.

 

[David M C]

Thanks, that's exactly what I needed. Just one more question now. Does
Project support day rates rather than hourly rates based on hours assigned to
a task. Some of our employees get payed x amount per day regardless of work
completed. Can Project reflect this? What about employees who are on a salary?

It seems like quite a simple addition if it is not currently supported and
must be common to most large companies.

 

[Steve House [Project MVP]]

Not in the sense you're thinking and you've stumbled on one of the reasons I
say over and over that Project is a cost estimating application, NOT a cost
accounting application. You can enter resource cost in whatever units you
like - $/hr, $/day, $/month, $/year - but the cost of doing a task is the
pro-rated cost of using the resources for just the hours that it takes to do
the work. Whether the resource is a paid an hourly wage, a independent
contractor's day-rate, or a salaried staff's annual salary, the cost of
doing the task is always calculated by dividing the cost down into an
equivalent hourly wage and multiplying it by the man-hours the resource puts
in on the task. If you think about it, that's the logically correct way to
do it. Joe Engineer may earn $5000 per month. But if you use him on your
project for one day, your project budget doesn't have to cover his costs to
the firm for the entire month, only for the day you've used him. Whoever
he's reporting to doing whatever else he does for the rest of the month is
responsible for his costs for the rest of his hours and your project's
budget is only responsible for portion of his overall cost that you have
used.

The same logic also applies to folks who say "we don't track resource costs
because they're all regular employees on payroll and we'd have to pay them
anyway." While that's true and the payroll costs to the firm might not go
UP because you're doing the project, the people working on it do represent
an incremental cost because when they're working on the project they can't
be doing something else productive for the firm. Those tasks not done
represent a lost opportunity and that in turn represents a cost of doing
business of the activities you DO do. If I need to spend 10 hours waxing
widgets, the cost of getting the widgets waxed is ALWAYS a cost to the firm
regardless of whether I hire someone from outside, and have new payroll
costs as a result, or divert internal resources from what they usually do
into waxing my widgets without actually having to pay out any extra dollars.
--
Steve House [MVP]
MS Project Trainer & Consultant
Visit http://www.mvps.org/project/faqs.htm for the FAQs