What to Do if Your Budget Eats Your Project Alive
What to Do if Your Budget Eats Your Project Alive – Use Project Management Templates
Speaking from experience, having the budget go completely out of line is one of my biggest fears as a project manager. On most of our projects, it’s not a huge issue if you’re plus or minus 10% on the budget. Especially if you deliver on time and the customer is happy and the project is successful. However, every so often you have those projects that are handed to you where you’re told to be on or under budget or else. You know the ones I’m talking about, don’t you? Those are the ones you lose sleep at night over. They usually have one or more of the following characteristics:
– Are very large and very visible
– Have a customer unwilling to spend a dime more than the original agreement
– The CEO is watching closely
– Are very small with a small budget
– Scheduled for implementation close to fiscal year end
That third one is always fun. There’s nothing like having the CEO stopping by your office regularly to ask how the Project Plan is going. It’s even more fun when he starts wanting to become involved in the project status meetings and asks you to hold them in his office on a conference call with the customer. At first it seems a little cool – after all good project managers love responsibility and visibility right. But after awhile it’s not so cool, it’s a little Big Brother.
So, once the project gets underway and this very tight budget starts to get out of whack, what do you do? You have to do something and you have to do it fast. A budget left to manage itself will devour your project fast and possibly your career along with it.
There are some critical steps you must take to either correct the project management template course or at least keep it from getting worse:
– Look for change order possibilities. Look for new revenue opportunities in the Online Project Management. This will give you chance to look good by creating more dollars of income for the company and depending on the profit margin it may even correct some of the budget imbalance.
– Inform the customer. Tell the customer early in the budget overrun process. The earlier you tell them the more time they have to make decisions on additional funding. If they like how the rest of the project is going, they may be more likely to add funding as long as they’re informed early.
– Inform your executive management. Keep your management team informed. They may have some tricks up their sleeves. But they never like to be surprised. And if you don’t tell them, then your customer will and bad news should come from you first. It’s never good when your CEO gets problem calls from YOUR customer.
– Track the budget in greater detail. Keep the budget updated and forecasted at least weekly. If you let it go, it will get out of hand….guaranteed.
– Keep your team members up-to-date on budget status. Keep your team informed of the budget status. If they know you’re managing it closely, they’ll pay more attention to the time they’re charging to the project and be more accurate with it.
These steps won’t guarantee budget success or that the budget problem will be corrected, but they certainly are good steps in the right direction. At least you’ll be able to say you’ve tried everything. And they will increase your chances at success.