The Importance of Budget Management

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There are numerous ways to manage a project in a company; but what is the best way to do so? A pragmatic method to manage your projects includes these three requirements:

I. Delivered according to the established schedule (Time) : It is very important to define a project’s steps because these can be identified according to their specific nature or to their time sequence. We proceed to the conception of a schedule in which the project’s main steps will be identified. In order to stay realistic, those steps will require the establishment of a time frame with the intention of dealing with unannounced problematics.

II. According to the specifications : The project’s specifications precisely define the nature and the amplitude of the deliverables. Generally speaking, these specifications are detailed throughout the project’s requirements. The technical considerations can be considered to be a method to define the project’s phases, but we will not got into details regarding this process.

III. With the established budget : The budget is a key element concerning the preparation of a project; by respecting the budget, you are able to reach the expected profit margins.

In a perfect world, project management would include the compliance of both the schedule and the budget. However, a budget’s quantities can sometimes be balanced even when the amounts are not, like in the following example:

project XY

For Project XY, we anticipated 100 hours at $100 each. To this day, we have used 50 hours from this budget, which equates to a profit of $5,000. For this same project, we had anticipated expenses of $5,000 but spent $8,000. Therefore, if our budget’s hours are still balanced, our expenses are not.

Consequently, the budgetary approach for project management shows the importance of establishing a time frame (adjustment requests management) while planning the project’s steps. This scheduled time span can help prevent the appearance of unannounced problematics which could easily influence the project’s progress. By planning a phase dedicated to adjustment requests, we can smoothly reorient our efforts upon the emergence of unpredictable events while complying with the established schedule.

A tool as powerful as Abak 360 becomes crucial in terms of budget management. Its multiple characteristics allow you to control every aspect of managing projects. You can even optimize your budget management by coupling it with Efficient 360, a software that optimizes project management and enhances team productivity.

Contact us for more details!

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