Back From the Brink: Keep Your Project Under Budget
Posted by Martijn van der Hoeden
Once your project is over-budget, there will probably be a great deal of explaining to do and finger-pointing from every direction. Breakdowns like these could put the entire project team in jeopardy.
There’s always a point before that point, though. There’s a moment when you can see where costs are headed and turn them around.
Here are some suggestions on setting up alerts when you are approaching the point of no return and how to prepare so you never get there.
Booked vs. Budgeted Hours
Project managers tend to have too much information and not enough at the same time. Too much incoming data from all over tends to obscure the most important factors, such as when booked hours are rising at a faster rate than was projected in the original budget.
The solution is a dashboard that filters out the less significant data and concentrates on visibility into budget impacts. “Completion per item” percentage fields should be linked to a “booked vs. budgeted hours” stream so you can create an alert where the curves diverge.
Setting Up More Intelligent Alerts
Typically, large-scale projects utilize one overall budget along with smaller budgets for independently operating teams. However, an alert system that is too narrowly defined can miss critical warning signs. Adaptations in resource management within each sub-project can affect all the others in a cascade of dependencies.
The modern project manager needs the assistance of Artificial Intelligence and cloud-based processors that can keep tabs on a vast number of variables as they respond to changes in the global economy.
Accomplishing More on Tighter Budgets
The best part about preventing budget overruns is that the cost of money is much higher for project recovery than in proactive prevention. Every project faces unexpected roadblocks, but you can steer around them by deploying smarter technology with more flexible planning. If you would like more practical tips on driving operational excellence, we invite you to watch our On-demand webinar, covering topics like auto-forecasting sales and mobile apps that simplify expense management. It’s not too late to save your budget from cost overruns and last-minute surprises.