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Project Management

Project expectations versus tight budgets: how to win

In the world of project management and the delicate balancing act of keeping all the plates spinning, it is often budget issues that undermine the process.

Whether it is working within tight budgetary constraints or facing unexpected cost blowouts, the financial angle is the one that needs to be closely monitored to ensure delivery success. If all four stages of the project lifecycle – planning, execution, tracking and reporting – include a strong budgetary guideline, risks can be largely avoided. We look at how to keep the numbers in check.

Devise a plan

Developing a solid roadmap that allows all parts of the team to follow is naturally the first step. Goal setting here is key and using the S.M.A.R.T guideline can assist with the process: Specific, Measurable, Attainable, Realistic and Timely. This stage is also where project scope can be clearly defined, which includes identifying cost, availability of resources and setting a realistic timetable.

Execute

Stating the deliverables to be developed and confirming timelines is the next step. This is a lengthy phase, featuring a high degree of concurrent activities. As such, at this point implementing cloud-based project management software can keep the process succinct, on track and allows for transparency and visibility across all team members.

Keep track

The measurement of project performance and hitting timeline goals is essential to keeping the budget healthy. Project managers using KPIs will be able to track the project deliverables against set deadlines and step in if any looming budget blowouts or delays seem pending. Including a KPI that is around ‘Effort and Cost Tracking’ will specifically allow project managers to account for the effective deployment of resources, which will determine if the budget is on track. This mode of tracking gives project managers insight into whether the project will meet its completion date, based on current performance.

It’s all in the reporting

As the project closes reporting is core to the assessment of performance and deliverables against cost. This robust reporting needs to be collated from the baseline in terms of cost, time and scope. A well-developed reporting system set up across the duration of the product will save time and headaches at completion. Insightful reporting allows a snapshot of where project managers and projects are realistically tracking at any point in the process and can identify the areas of cost that need to be curtailed.

More specifically, here are some key strategies that will assist in maintaining control of the project budget at every step;

  • Keep budget forecasts fluid: Don’t be afraid to reforecast during the project. Budget management and tweaking may save the day at the end as 10 percent budget blowout mid-way during the project is easier to correct than a 50 percent blowout at the end.
  • Keep track of resourcing: In the same vein as regular budget revisions, resource usage should also be closely monitored. It is easy to overlook this particularly if the deadline is onerous and it is tempting to throw resources at the project to reach the goal. But by reviewing people resourcing and their output each week, it will be easy to tweak processes so they moving according to plan.
  • Information and communication:  The project team should be aware project budget forecast so they can curb when needed and they are aware of the parameters. Information is empowerment for a well-functioning team.  By knowing what their boundaries are there will be less tendency to work longer hours and make the most of the ones that are within scope.
  • Scope is your friend: Unplanned work may enter the project and blow out billable hours.  The art of project management is to carefully manage scope by being rigid in terms of what is mandatory for the project’s requirements.

Skilled project managers that carefully watch budgets through the lifecycle of their projects will keep all stakeholders and clients happy without any nasty surprises at completion.  Investing in a Graduate Diploma in Project Management can greatly enhance skills for all managers and allow them to apply advanced tools to execute a diversity of projects within budget and expectations.

You can learn more about our IntensiveOnline Postgraduate Programs or speak to one of our expert RMIT Student Enrolment Advisors today on 1300 701 171.

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