Changes are inevitable when it comes to software development. Much of these changes could throw your initial budget off track, making your project vulnerable to lots of risks.
To offset these risks, agile teams need to do two things:
Here are tips to help agile project management teams create well-defined results while staying on budget.
For starters, identify project requirements early in the process. Then, confirm and document these requirements with the stakeholders involved. You have to ensure that all concerned parties are aware of them. It’s a crucial step that teams need to complete before setting a budget.
Several managers make the mistake of initiating projects around wants. This immediately puts projects at risk of overruns that could have disappointing results later on.
When creating a budget, you also need to factor in things beyond your control. Some examples include labor, resources, fluctuating prices of supplies, shortage of products or services, exchange rates, and a lot more.
Set up a backup plan and ensure vendors can deliver on their promises. Gathering input from other stakeholders and vetting suppliers is a good start. It can help you set up a more realistic budget, even if unforeseen circumstances occur.
You can manage a project budget effectively better with the help of key performance indicators (KPIs). Agile teams use KPIs to determine how much time an individual spends on a project. They also let you know the extent to which the actual budget differs from the planned one, and so on.
Teams need a collaborative and transparent environment with stakeholders during the development process. Take note that stakeholders should see the project progression clearly. You have to provide them control when swapping in and out features from sprints. This results in a high-quality project without going over budget.
Your budget should be a living part of your agile project management efforts. It’s something you review with your team and other stakeholders on a regular basis. Project managers should make budget management their primary area of focus for a higher chance of success.
Follow the tips above for a more accurate, flexible budget as you turn the Agile Manifesto essence into action.