5.2: Plan of Attack

🎯 Objective of This Milestone

You are now building a financial model for your project. This milestone requires you to translate the execution plan from Milestone 3 into a detailed, structured, and defensible budget—one that could be presented to a sponsor, finance lead, or procurement authority.

The final submission must include:

• A breakdown of all anticipated project costs (labor and non-labor)

• Calculated labor cost estimates based on prior effort figures

• Transparent pricing for tools, licenses, vendors, or materials

• Justified contingency buffering

• A clear, professional summary of what the budget enables

📘 What You Will Produce

Your final deliverable will consist of the following five core components:

Section	Description
1. Cost Inputs and Categories	A clear and comprehensive inventory of all cost-driving elements grouped by type
2. Labor Cost Estimation	A detailed calculation of effort × role × rate, linked to the WBS
3. Non-Labor Cost Estimation	Estimates for tools, subscriptions, training, travel, and other goods or services
4. Total Budget and Allocation Model	Roll-up of all costs with subtotals, grand total, and structure by phase or category
5. Contingency and Funding Narrative	A reasoned buffer based on risk, plus a summary that tells the “financial story” of your project

🧭 Step-by-Step Plan of Execution

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🔹 Step 1: Identify All Cost Categories and Inputs

Start with your WBS, architectural model, and execution plan. Build a working list of anything that will require funds, including:

💼 Labor

• Time spent by analysts, developers, PMs, testers, trainers

• Internal staff time billed to the project

• External consulting or contract staff

🧰 Non-Labor (examples)

• Software licenses (e.g., per-seat tools, design software, PM systems)

• Cloud platform or hosting services

• Specialized equipment or configuration tools

• Third-party vendors (data cleansing, trainers, accessibility services)

• Stakeholder events (e.g., pilot launches, training sessions)

• Travel, room bookings, meals (if in-person support is needed)

🧾 Classification

• Direct vs Indirect: Is the cost tied directly to deliverables, or a shared overhead?

• Fixed vs Variable: Is the cost stable or usage-based?

• Recurring vs One-Time: Will this expense repeat monthly or occur once?

📘 Deliverable: A categorized table of all cost inputs with basic tags for classification.

Item	Type	Classification	Description
Developer labor	Labor	Direct, Variable	240 hours over 6 weeks
Training software	Non-labor	Fixed, Recurring	$25/user/month

🔹 Step 2: Estimate Labor Cost (Effort × Role Rate)

Take your task-level effort estimates from Milestone 3 and apply hourly rates based on:

• Internal rate card (e.g., C-Bay rates: PM = $110/hr, Dev = $95/hr, BA = $85/hr)

• Industry benchmarks (if rates not given—justify with source)

• Assumed team structure and availability (e.g., 50% allocation, 80% billable)

📘 Example Calculation:

Task: Conduct stakeholder interviews
Effort: 16 hours
Role: Business Analyst
Rate: $85/hr
→ Total Labor Cost = 16 × 85 = $1,360

Break this down:

• By task

• By role

• By project phase (optional)

📘 Deliverable: Labor Estimation Table

WBS ID	Task	Role	Effort (hrs)	Rate	Cost	Notes
1.2.1	Conduct interviews	BA	16	$85	$1,360	Assumes 4 interviews @ 4 hrs each

🔹 Step 3: Estimate Non-Labor Cost

Using your Cost Inputs list from Step 1, calculate:

• Unit Cost × Quantity × Duration

• Research pricing benchmarks if real quotes are unavailable

• Document all assumptions (e.g., “$25/license/month based on vendor website”)

📘 Examples:

• 12-month license for PM software: $30/user/month × 5 users = $1,800

• 2 stakeholder training days @ $850/day = $1,700

• 20 data transformation hours from vendor @ $150/hr = $3,000

📘 Deliverable: Non-Labor Cost Table

Item	Category	Quantity	Unit Cost	Duration	Total Cost	Source
Cloud subscription	SaaS	12 mo	$300	N/A	$3,600	Vendor X pricing sheet
Training session	Event	2	$850	N/A	$1,700	Industry avg training rate

🔹 Step 4: Build the Total Budget and Allocation Model

Create a consolidated view of:

• Labor cost total

• Non-labor cost total

• Contingency

• Grand total

• Optional: by phase, milestone, or deliverable

Use consistent structure. Clearly label rows and subtotals.

📘 Deliverable: Budget Roll-Up Table

Phase	Labor	Non-Labor	Subtotal
Planning	$8,240	$1,800	$10,040
Design	$14,100	$3,400	$17,500
Implementation	$20,500	$5,200	$25,700
Total (Pre-Contingency)	$42,840	$10,400	$53,240

Then calculate your contingency (see Step 5) and append it:

Contingency (7.5%)	$3,993
Grand Total	$57,233

🔹 Step 5: Add Contingency and Write a Funding Narrative

Contingency

• Base your buffer on:

  • Risk exposure

  • Estimate uncertainty

  • Task complexity

  • External dependencies

• Apply it per category (e.g., 10% on non-labor, 5% on labor), not just an overall “fudge factor”

Narrative

Write a 1-paragraph financial summary from the point of view of a project leader presenting to a sponsor.

📘 Should answer:

• What is included?

• What is the basis of estimation?

• How does the budget account for risk?

• What value will this budget enable?

📘 Example:

“This budget reflects the full execution plan approved in Week 6. Estimates are based on actual effort projections and market-standard rates. Contingency has been applied based on risk factors tied to stakeholder input availability and third-party tool integration. This funding will support configuration, training, testing, and deployment of the UCMS platform and prepare the system for live use by the beginning of Q2.”

✅ Final Deliverables You Will Submit

1. Cost Categories and Input Summary

2. Labor Cost Estimation Table

3. Non-Labor Cost Estimation Table

4. Total Budget + Contingency Roll-Up

5. Funding Narrative (1 paragraph)