Describe any three reasons that cost overruns occur in project work

What will be an ideal response?

The most common reasons for cost overruns are low initial estimates, unexpected technical difficulties, lack of definition, specification changes, and external factors. Low initial estimates may be created deliberately, perhaps as an effort to gain approval, or accidentally, through carelessness, but will almost always result in a cost overrun. Unexpected technical difficulties often occur in high-tech projects that require bleeding-edge technology. Lack of definition as a result of poor initial scope development creates projects with poorly defined features or goals, which spills over into poor cost estimates. Specification changes resulting in scope creep from the initial baseline project inevitably require more time and money to bring the project into alignment with the new, larger scope. External factors beyond the control of the project organization require a response, one that calls unanticipated resource requirements into the fray, resulting in cost overruns.