Keeping up with the latest posts, we have agreed to treat one crucible more budget, remember?
It does not hurt ... we do not even remember what it did yesterday ... Did you do it?
Leave it and return here:
If you have lost the previous articles, it accompanies:
- We talk about planning cycle,
- We think about our relationship with money here,
- We take a ride with Zeca Pagodinho and we reverse rhyme e
- We brought budgeting tips.
Ready! We close the mid-year retrospective and try to move on.
The theme is:
What to do with the budget?
The question is not misplaced as it may seem.
The easy answer and the tip of the tongue would be:
"Follow up, now!"
However, we prefer another approach: to evaluate, to measure the budget.
Come along, it's just starting and you have time to finish.
Assumptions - the relevant step
Just to remember, we commented in the previous article that it is in the budgeting phase that we are actually getting to know the object a bit more.
Let's be sure that in the budget we will know a bit more, just
What does this mean?
The question is: there is still a lot to know, much to uncover throughout the execution of the project and if we expect to know everything, we will never start anything, will we?
To realize the budget, we have the premises.
Get on the stage and light the spotlights !!
What an incredible performance! What a highlight!
Worth to do selfie!
Joking aside, are the premises that will be the basis of the budget evaluation.
The context in which it was "thought", how much was unknown and "assumed" as a given or information. An adverse or favored condition.
Everything is premisses.
In the unfolding of events, or in more focused language, in the development or in the execution phase of the project, the premises can sink, you know?
It may be that what was thought, for reasons internal or external to the project, later turns out to be wrong.
It is clear that the misunderstanding may be broad or may be confined to certain parts or activities of the budget.
It may also entail an increase in the budgeted amount or a reduction.
Hence the idea of gauging, of evaluation, to the detriment of the vision of "monitoring".
Obviously (which we always revisit here): the recording of the premises is fundamental.
If there is no record, how to "understand" the reasons for assigning a certain price or condition.
By condition, we can mention:
- how much is produced,
- how much is needed to perform a certain activity, or
- how long.
To simplify and reduce the digressions we will analyze a proposal.
Depending on the object of the budget the incidence of labor may be greater or even negligible when compared to the whole.
If it is relevant, proposals for additional care are presented:
- It's the first project of its kind: the assumptions of labor used were obtained in the external environment and, in fact, may not translate the manpower used in the project.
Therefore, productivity and even compensation can lead to a deep deviation from what was thought.
- The evolution of the project occurs in different stages from which it was originally conceived and sequenced.
Methodologies, equipment or even an innovation created during execution, interfere in the result.
Less hours of staffing and more hours of equipment.
More final cost or lower cost ....
Build different scenarios
It is evident, or at least we strive for this, that the budgeted and the accomplished keep distance.
The distance may be large, small, but the historical must remain.
This is the basis of the budgeting process, and it is from this that important maturity is built to evaluate scenarios.
Evaluate with a more accurate perception of the team, overcoming previous difficulties and establishing a learning curve.
Therefore, measuring distance at regular intervals is what guides the course.
In the scheme, it is evident the comparison between the budgeted (predicted) and the realized.
Take a look at the size of the animal's open mouth:
Distance is the deviation.
Does the image look like a severe deviation or is it going to be quiet to resume?
To close the conversation
Magic potions, wands or swords of light, spectacular figures, none of this can in fact, close the mouth of the beast.
A more feasible suggestion: gauging, revising, maintaining the basis of what was thought and planning a recovery.
Start all over again! Well said PDCA.