Budget

If your Degree of Fit is just not there, or the balance between it and the budgetary estimate is not favorable, the risk that project will exceed the budget or not meet the requirements is high, but you might still decide to go on. In fact, most consultants often do, choosing to fight the odds.

Fit Gap Analysis is one of the core activities of the Sure Step. It’s in fact so important that on most projects this activity should be done twice: the first time you do it on a very high level just get a quick overview of customer’s processes and requirements, and the second time you dive deep down into details to figure out everything.

The Sure Step season seems to have started in its fullest for me – it is the second time this year already that I’m delivering the Sure Step course, this time in Copenhagen, Denmark, and I must say that I truly enjoy it.

I’ve seen a few projects where customers said they didn’t need contingency, because they decided to adjust the budget as changes happen. How does this sound to you? To me, this sounds pretty bad, because there is an important distinction between adjusting the budget based on change requests and consuming the contingency reserve.

If projects were completely predictable, there would be no need for risk management . Everything could be planned and executed according to plan. However, we know better. Unexpected things happen, disrupt the original plans and cause time and cost overruns. In IT projects, these overruns are far too common to be ignored.

Last week I participated in a discussion about budgets and whether you should ask your potential customers their budget. It made me think: how often do customers reveal their project budgets before the consultants bid? From my personal experience—not too often. What a waste! Of time, money, and opportunity.