Budget management is something that all project managers need to master if they are going to be effective in their role. There is nothing worse than finding out that you have spent more than you should have. And, if it is one thing that stakeholders hate, it is spending more than they had bargained for. Below, we are going to reveal some top tips for managing project costs to give you a helping hand.
Plan for future resources – It is vital to keep track of the resources you use. For example, if you use contractors throughout the project, you need to review the number of contractors working on the project on a regular basis. This will feed into future resource requirements.
Communicate with your team – The importance of communicating with your team cannot be expressed enough. You will have better ownership of the project and a greater chance of success if you communicate. It can also help you to manage your budget, as you will know exactly what tasks are going on and what is required for them. Moreover, your team members will feel more comfortable coming to you about matters relating to finance and scope creep. Remember, an informed team is an empowered team.
Forecast resource usage and your budget on a regular basis – You can stop your budget from getting out of hand if you check over it on a regular basis. Correcting a 50 per cent overrun would be a nightmare, but correcting a 10 per cent overrun is fair easier. This is why it is important to review your budget every so often. The same also goes for resource usage. The people working on the project contribute to the cost of it, which is why you need to review this so that you can make sure you are using all resources to full effect.
Keep tabs on scope change – The main reason why projects go over the designated spend is due to scope creep. If unplanned work starts to mount up, the hours required to complete the project increase as well, as do the resources, and soon spending gets out of control. If you can manage scope change better, you will automatically manage project costs better.
Take a project management training course – There are many project management training courses to choose from today, including the PMP course and the APM introductory course. All of these courses will cover budgeting to a degree and, therefore, this is a great way to broaden your knowledge. You will learn about different techniques you can use and technologies you can implement in order to budget effectively.
Hopefully, the tips above will have given you some advice to help you manage your budget more effectively. Remember, it is important to be realistic about costs, and you need to track everything meticulously too. If any problems do arise, inform stakeholders and anyone else that needs to be informed as soon as possible. And, don’t forget that training courses can help you to get the skills you need!