Implementing Project Portfolio Management: From Organization Structure to Recognized Revenue · Module 11 · Burdening and Cross-Charge
What breaks
Lesson 119 of 198 · 2 min
Seven cases. One. "Costs are not burdening." Not enabled on the project type, or no schedule assigned. Module 7. Two. "Burden is calculating on the wrong base." The cost base definition includes or excludes the wrong expenditure types. Three. "A backdated cost burdened at this year's rate." The rate was overwritten rather than effective-dated. Four. "Margins looked great and the year-end adjustment was painful." UNDER-BURDENED ALL YEAR. Burden rates stale, so projects were under-burdened all year. Every project looked more profitable than it was, for twelve months, and every bid priced off those margins. That is Lesson 1's commercial consequence, arriving as a single adjustment nobody budgeted for. Five. "Cross-charge is not happening." The process was not run — or it is not enabled between those units. Six. "Cross-charge priced at zero." No applicable transfer price rule. Seven. "We discovered cross-business-unit working in month four." Not asked in the design…
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