Introduction to Project Budgeting and Estimating

• Preparing realistic budgets
• Burning through a project budget
• What's in it for me: living within your budget

Aligning Budgets from Small to Large

Structuring budgets and defining roles

• Delegating individual budgeting activities
• Connecting project, program and business budgets

Leveraging the four functions of the budget

• Planning and justifying the project
• Coordinating and communicating between stakeholders
• Monitoring progress
• Evaluating budget performance

Cost Estimating at the Individual Task Level

Activity-Based Costing (ABC)

• Working with the Cost Breakdown Structure (CBS)
• Relating the CBS to the budget based on the organization's standards

Categorizing costs

• Determining activity-level direct, indirect and other costs
• Aggregating tasks up to total individual costs

Project-Level Budgeting

Mapping to the project life cycle

• Correlating budget detail to the life cycle stage
• Producing deliverables that facilitate phase-gate decisions

Working with estimation tools

• Adjusting an analogous estimate to suit your current project
• Calculating the budget using parametric Cost Estimating Relationships (CERs)
• Increasing confidence levels with three-point estimating

Incorporating project-level cost categories

• Accounting for resource commitment levels
• Collecting individual cost estimates
• Adding in overhead and general and administrative costs

Forming the interim cost baseline

• Determining the Total Project Cost
• Managing the team's estimation process
• Setting the standard of estimation
• Conforming to granularity and accuracy requirements

Quantifying Risk and Finalizing the Baseline

Analyzing quantitative risk

• Assessing probability
• Establishing the monetary value of the impact

Allocating a contingency budget

• Prioritizing risks using a Pareto analysis
• Locating and controlling contingency

Declaring and revalidating project value

• Valuating hard and soft savings
• Stating the customer's value proposition for baseline approval

Allocating Program Funds

Deriving the content of the program budget

• Generating the Rough Order of Magnitude (ROM) estimate
• Applying PERT analysis to the entire project

Defending your project budgets

• Calculating rate of return
• Balancing project and opportunity costs

Creating a Master Budget for the Business Unit

Strategic positioning

• Gauging your competition
• Trading off costs and benefits for maximum return

Forecasting future values

• Calculating potential results using decision trees
• Making predictions using Net Present Value (NPV)

Managing cash flow

• Constructing the balance sheet
• Graphing your cash expenditures
• Conforming to imposed budget constraints

Improving the organization's budgeting process

• Controlling quality with SWOT and Lean Six Sigma
• Applying Kaizen for continuous process improvement
• Impacting the organization's bottom line

Measuring Budget Performance with EVA

• Performing budget-based Earned Value Analysis (EVA)
• Correcting for variance from baseline
• Forecasting budget performance based on actuals
• Determining when to rebaseline