We have all done budgets in our personal lives. Is estimating the budget for your department much different? Of course, yes. When an employee is promoted to a managerial role, he or she receives little or no formal training on how to develop a budget forecast and track expenses. In this article at Project Management Basics, Dmitriy Nizhebetskiy lists out the steps that a junior manager must follow when estimating budget for the team.
How to Build a Budget?
Dimitriy explains, “All companies have a different approach to creating project budgets. Most companies have processes and workflows that you must follow.” Here are a few steps that a junior project manager must follow to build a budget for projects.
Use the Project Charter Tool
Project charter tool is a short document that describes your project in its entirety. Thus, begin with using the project charter. Use the information available on charter to develop project requirements.
Develop Project Scope Statement
A project scope statement provides a detailed description of the work, defines boundaries, estimates the expected outcome of a project, and identifies the constraints that hinder the success of the project. This will help you plan your budget accordingly.
Create a Work Breakdown Structure
The work breakdown structure for any task or plan will help you get granular about the work that needs to be completed. Creating the work breakdown structure will help you understand if your estimate will exceed the proposed budget/deadline or not.
Start Building Your Budget
Involve your team and help them understand the budgeting process. This will create a sense of shared ownership and inspire your co-workers to find creative ways to manage expenses. Additionally, you can communicate with other department leads to determine which course of action will work best for your budgeting.
Review your spending regularly throughout the year. Ensure that you are staying within the budget and adjust your spending accordingly. To learn more about budgeting, click on the following link https://pmbasics101.com/project-budget-example/.