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Saving for a Rainy Day

When having a business plan reviewed by senior management, you have to justify all expenditures. So how can you justify an expense under the heading ” contingency buffer”? Karl Wiegers makes the case for including a budget for surprises and errors, and why having such an expense in place can actually save money. According to Wiegers, you can explain the need for a contingency buffer based on historical data and by having a proven calculation for determine the amount of a buffer needed. He goes on to state that adding a buffer to every task is dangerous (citing Parkinson's law of work expansion to fit time allotted), and rather having a reserve that is removed from the task estimates reduces the possibility of resources to work longer simply because they have time to do so.

About Anne Grybowski

Anne is a former staff writer for CAI's Accelerating IT Success, with a degree in Media Studies from Penn State University.

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