Poor Cost & Schedule Estimation
Unattainable deadlines are often imposed on project teams.
Unrealistic budget estimates are a direct result of poor planning and vague requirements definition.
Some projects are plagued by intentional underbidding by vendors in a competitive RFP.
One very effective solution is to phase projects. When early phases include “big wins” or “low hanging fruit” the project return on investment starts as soon as possible.
Research indicates that smaller projects are more likely to be successful1. Break up larger initiatives into a number of smaller, discrete efforts that are easier to manage.
One very effective means of working around imposed deadlines is to offer a menu of choices to stakeholders. Features A and B can be delivered by the deadline, but features C, D, and E will have to wait until Phase 2. Similarly, if budgets are tight, develop cost estimates for discrete features and allow stakeholders to choose which are most important. A lower cost will inevitably mean reduced features. But the decision to include or exclude a given benefit should be made by the stakeholders.
Offer more than one schedule to stakeholders – a best-case time line and a worst-case time line. Be sure to explain the specific factors that will lead to the worst case coming true.
Revisit estimates regularly and monitor progress against plans. Be prepared to make adjustments as necessary and communicate the changes in order to manage stakeholder expectations.
This is one of a series of posts on project management for finance professionals. The series features practical project management advice and tips for driving process change using technology. The series is archived here.