If your project goes wildly over-budget, as is very common for projects, it will not be deemed a success, even if it meets the original deadline and purpose. So if you are a project manager or are otherwise in charge of managing projects for your company, keeping the budget in check is bound to be one of your top priorities. Use these strategies to control your budget and deliver on every project you organize.
Project the budget frequently
One of the most important strategies you can use to manage your budget is to keep it relevant and up-to-date. Without frequent budget updates and adjustments, your project will likely be headed for imminent failure. This is more important than most people realize because failing to keep track of the budget will inevitably allow it to get out of hand. However, if you frequently project or forecast the budget, you’ll be able to adjust as needed and keep the numbers more on track. Reviewing, adjusting and sharing the budget will keep it fresh in your mind and at the forefront of your focus.
Monitor resource usage
The manpower behind a project is one of the primary costs for any major undertaking. So another way you can keep your budget more on target is by consistently tracking your resource usage. To most effectively manage these numbers, you or your project manager should regularly review the number of people actively working on the project and analyze that against the project’s upcoming resource needs. This type of management should be completed each week. Taking the time to manage your resources in this way will ensure that you are currently using them effectively and that you also have the right resources available for the remainder of your project. Regularly revisiting this component of your project will help you keep the budget on track.
Get everyone involved
Just as the project is likely a team job, so is managing the budget. Keeping your team informed about the budget will help everyone work together to stay on track with the finances of the project. If you look to the other members of your team as beneficial assets to help you manage costs, they will be more at liberty to help you in that respect and much more inclined to watch their expenditures. This practice leaves much less to chance in that “gray area” of charges – typical constituted of hours that team members know they worked even if they aren’t sure exactly what they were working on. By sharing the financials with your team, you empower them to help manage the project more effectively as well.
Maintain your project focus
Some people like to think of this one as “scope creep”. In other words, anytime you are doing a project, there is a tendency for some unplanned work to find its way into your timeline. This shift in focus can not only derail your project deadline, but it can also have devastating effects on your project budget. The main concern with this issue regarding your budget is that as that unplanned work makes its way into your project, billable hours increase that can make costs get out of hand. You or the acting project manager can manage the scope or focus of your project by using a sales dashboard to monitor and create change orders for items or work that isn’t already covered by the project’s initial requirements. These orders authorize additional funding for the project to cover the cost of any extra work that is required and keep the project on track with its newly established budget.
The Procurify Way: Find Out All You Need to Know About Budgeting and Forecasting
These strategies are particularly important if you are involved in bookkeeping for small businesses as keeping costs in check is typically even more important for small business owners. In any case, though, regularly forecasting your budget and resource usage, keeping everyone involved in the process and maintaining your focus will help you keep costs low and the project on track.