Just dove into two excellent resources from The Digital Project Manager on project cost management and budget creation. Links:
- https://thedigitalprojectmanager.com/projects/managing-costs/project-cost-management
- https://thedigitalprojectmanager.com/projects/managing-costs/how-to-create-project-budget
These articles cover essential aspects of project cost management, from planning and estimation to control and reporting, and provide a solid framework for creating a robust project budget.
From a SAFe 6 Practice Consultant’s perspective, I see several key takeaways:
- Lean Budgeting Alignment: The emphasis on accurate estimation and cost control resonates strongly with SAFe’s Lean Budgeting principles. In SAFe, we focus on funding value streams rather than individual projects, but these budgeting and cost management skills are critical for effective portfolio management and understanding the economic impact of our investments.
- Value Stream Economics: The articles highlight the importance of understanding all cost components. In SAFe, this translates to rigorously analyzing the Total Cost of Ownership (TCO) within a value stream. We need to consider not just development costs, but also operational expenses, support, and maintenance.
- Agile Estimation & Forecasting: SAFe’s focus on iterative development and frequent feedback loops aligns perfectly with the need for continuous cost monitoring and adjustments. Using techniques like story point estimation and velocity tracking along with lean budgeting techniques (such as participatory budgeting) allows for more accurate forecasting and proactive cost management.
- Transparency & Collaboration: The articles stress the importance of clear communication and stakeholder involvement. In SAFe, this is achieved through regular PI Planning, System Demos, and Inspect & Adapt events, ensuring everyone has visibility into the project’s progress and financial status.
- Focus on Value: Ultimately, cost management isn’t just about cutting expenses. It’s about maximizing value delivery. SAFe helps us prioritize features based on their economic impact, ensuring we invest in the most valuable work.
In a SAFe environment, these cost management practices become integral to the overall success of the Agile Release Train (ART) and the larger value stream. By applying these principles, we can ensure that our investments are aligned with strategic objectives and deliver maximum value to our customers.
#SAFe6 #Agile #ProjectManagement #CostManagement #Budgeting #LeanBudgeting #ValueStreams #DigitalProjectManager
