The video addresses the typical negotiation tradeoffs, and introduction of risk, that comes with adjusting the initial budget for the project. It also addresses accommodating the budget constraints in project management approaches.
- Budgets aren't always good news…but we have to share that truth as early as possible.…Bad news ages like milk, not wine.…We need to deal with the good and the bad…of the project budget to protect your integrity…and the integrity of your project.…I have two golden rules when it comes to communicating…your budget, don't pad things,…and be prepared to have difficult conversations.…
Let's talk about padding your budget first.…Padding your budget is when you put extra costs,…inflate costs, or otherwise try to expand your budget…without a distinct, outlined rationale for inflating costs.…There's no point presenting increased, decreased,…or otherwise unrealistic budget estimates to your sponsors.…It doesn't do anyone any favors.…You should base your budget on accurate information…that you've drawn from your work breakdown structure.…
If you want to add contingency dollars…to address potential risks you should clearly communicate…the need for contingency dollars as a separate budget item,…detail when those contingency dollars may be needed,…
Note: This course follows the latest guidance from Project Management Institute, Inc., as outlined the PMBOK® 6 Guide.
- Recall best practices for project budgeting and estimation.
- Distinguish common estimation approaches used to build project budgets, and understand when to use them.
- Identify best practices for budget expectation management, while utilizing sound budget refinement techniques.
- Describe and explore agile project budgeting techniques.
- Review various approaches for correcting project budget overruns.
- Review sound budget reporting approaches, including how they can be used to report project status.
- Recognize the issues and changes that can put a project budget in jeopardy.