As a Project Manager it is essential to have financial knowledge to manage a budget well and precisely. Know all the cost to include in your budgets and try not to overlook any important costs. Once you have identified the costs that need to be included it’s a good idea to start off with estimates. Your estimates will fluctuate as the project progresses, don’t worry this is normal. In order to meet targets make sure you have cost tolerances that meet senior managements expectations.
A budget is more than just a balance of expenditures. A budget also serves as a metric that Project Managers can use to make informed decisions. A budget can also be used to identify key points in a project where decisions may need to be made.
The best way to keep track of what your spending is to keep track of the project process itself. Know where you are in the process and what you budget target was set at for that point in the project. Make sure the project and the budget match.
The size of the project small or large should not affect how you go about setting your budget. Small projects are just as much work as large projects. The budget process should be similar for both just at a different financial scale.
Knowing how to manage budget is a key factor to being a successful Project Manager.