When to use it
Use it before approving changes that affect cost, timing, benefits or risk.
When to be cautious
A supplier’s quoted implementation cost may omit testing, transition, operating cost and displaced work.
Apply it
Incremental cost = forecast with change − forecast without change
Compare the same time horizon, scope boundary and price basis; include secondary effects only once.
- State the change, alternatives and the reference baseline.
- Estimate direct and consequential effects on the same time horizon.
- Record the decision, authority and approved updates to the baseline.
An example in practice
Adding a reporting feature also requires data cleansing and support training. Include both before assessing whether the benefit justifies the change.
Source & credit
Standard estimating practice; the cited guide documents use rather than claiming invention.
GAO: Cost Estimating and Assessment Guide
This explanation and example are independently written. The source is a reading reference; linking it does not grant permission to reuse its text, figures or assessments.