As an administrative professional, managing projects is a key function of your role. Furthermore, one of the most important aspects of successful project management is budget planning. In this article, we provide you with helpful tips on creating a budget plan that will help you shine as a project manager.
Simply put, a budget plan is a spending plan that takes into account estimated income and expenses. Creating and sticking to a budget plan helps you to not overspend and stay within your allotted budget for each project. A budget plan should be set before the project begins, but also must be open to adjustments along the way.
For business projects and project management, your budget plan should include the following:
Estimation of all your expenditures
A parameter for making decisions and purchases throughout the project
A tool to monitor the progress of the project and whether it is staying on budget
Be sure to create a budget plan early on, and then use it to monitor spending throughout your project. This will ensure that you don’t overspend or run out of project resources.
The best budget plans anticipate and estimate every individual part of the project. It is often helpful to break the project down into smaller milestones or phases, and estimate costs for each phase. This should include everything from travel expenses, training resources, material resources, and research and development costs to overtime and sales tax.
There are software programs and apps available to help you create budget plans. Companies such as PlanGuru, Xero, Quickbooks, and Float offer great budget planning apps. They’re also user-friendly and often come with training videos to help you acclimate to the software.
However, they do come at a cost. If you choose to go with one of these programs, ensure that you include the monthly cost in your project budget plan.
First, ensure your budget planning is completed before the start of your project. This way, you can monitor the project's progress and costs from day one. Also, in many cases, you will need to complete your budget planning in order to get project approval from your executive team or Board of Directors.
Here is how to get started on a simple budget plan:
Break your project down into phases, each with their own milestones
Make a task list or to-do list for each phase of your project
Estimate the cost for each task list
Add your estimates together for a rough idea of your project cost
Add in a budget buffer to account for unforeseen expenses, rising material costs, taxes, and project errors
Present your budget plan in a concise and organized format
When you estimate the cost for each task, separate the costs by project phase. If you are not using a budget planning software program, using an Excel spreadsheet is useful.
Also, when adding in a buffer for unforeseen expenses, somewhere around 10% of the overall project budget is usually sufficient. If you complete your project right on budget, you’ve done well. If you complete your project with a surplus in your budget, you are likely to exceed your team's expectations.
Creating an accurate and realistic budget plan takes time and thorough research. The more time you take to compile accurate costs and expenses, the smoother your project will go. Consequently, you will become more confident in budget planning and organization.
For more information and tools on project management and budget planning, look to ASAP. Our articles, templates, and webinars are designed to help you succeed in every aspect of your admin role.
Welcome to the ASAP Circle, a community platform for peer-to-peer conversation on trending topics, professional challenges, and shared experiences. We even have designated spaces for weekly Tuesday Coffee Breaks.