Budgeting planning is the act of creating and maintaining a budget, then using it to make strategic business decisions and guide organizational changes across various departments.
Every project boils down to money. If you had a bigger budget, you could probably get more people to do your project more quickly and deliver more. That’s why no project plan is complete until you come up with a budget. But no matter whether your project is big or small, and no matter how many resources and activities are in it, the process for figuring out the bottom line is always the same.
It is important to come up with detailed estimates for all the project costs. Once this is compiled, you add up the cost estimates into a budget plan. It is now possible to track the project according to that budget while the work is ongoing.
Use Planning and Budgeting to:
- Develop planning targets.
- Access and analyze historical and current data.
- Connect strategic objectives with daily processes.
- Link top-down targets with bottom-up budgets.
- Integrate and update financial statements as business conditions change.
- Conduct continuous forecasting.
- Perform real-time, multidimensional modeling of your planning and budgeting data.
Determination of resource cost rates: People who will be working on the project all work at a specific rate. Any materials you use to build the project (e.g., wood or wiring) will be charged at a rate too. Determining resource costs means figuring out what the rate for labour and materials will be.