A couple of months ago I wrote a post entitled 5 Ways to Build a Budget Using the Cost Planning Features in Tempo Folio for JIRA. I'd like to expand on that and show how those ways of planning costs I discussed before are also great starting points for creating a budget for your project in general.
It’s great to have every single cost and detail of your project planned up front, but let’s face it, we don’t always know every single expense up front and different roles will be creating budgets for different kinds of projects and perhaps they set up projects or track costs in different ways. It’s also a simple reality of project management that unexpected expenses always occur, and sometimes we simply need to get started and don’t have the time to do a lot of planning.
One great thing about Tempo Folio is, if you have any four of these metrics listed below up front, then you can go ahead and set up your project and start tracking costs in real-time. Tempo Folio will essentially do all of the legwork for you.
Of course the more information you have, the more accurate your forecasts will be, but here are some ways to get you started. These four ways of creating your budget, however, can be used as best practices whether or not you're using Tempo Folio or another project management software solution.
If you're using Tempo Folio, you can find the options for planning the costs listed below by going to the costs section under the planned tab as seen here:
1. Lump sum
The first option is to create a budget from a lump sum. This is probably the easiest way to create your budget, but also likely the least accurate. It could be the right option for you, however, if you have a specific number you have to stay within, but it’s not so important to you exactly how that money is allocated. It might also be beneficial if you don’t have estimates up front or don’t have the time to define a detailed budget.
In Tempo Folio: Simply select the Lump Sum planned cost option, and enter the total budget of the folio per day. The cost will be automatically spread throughout your folio’s total timeframe.
2. Estimated effort
It is also possible to start creating your budget by estimating the tasks that need to be completed for the project and how much time they will take. From there you can figure out how many staff member's you will need to complete your project and estimate a budget based on how much those staff members will cost you.
In Tempo Folio: You can easily do this in Tempo Folio by planning from the estimated hours on JIRA issues within the scope of your folio. If you’re using this option, then you need to first have made some estimates on how much time you expect the tasks within your project to take. Tempo Folio will calculate the number of staff position that will be required to complete your project. Estimates can be based on hours or story points. This is a great option for JIRA users, who already have all of their issues defined and complete with estimates. To use this option, click on the plan from estimates option.
3. Individual expenses and/ or positions
Another great place to start is by identifying individual costs and/or staff positions. Adding planned costs individually to your budget in detail allows for maximum precision.This option takes a bit more planning up front, but if you have a good idea of the staff you will need to complete the project and the expenses that will occur, it is a simple way to create a detailed budget and get tracking.
In Tempo Folio: You can do this manually using the Plan an Expense and Plan a Position buttons, or you can also import costs through a .csv file if you prefer. If you're using this option, you will also get the most out of the reporting capabilities.
If you already have the staff defined that will be working on your project, you can simply plan your budget based on those staff members and their wages. It is a very simple way to plan the budget of your project. This is also a great option if you are simply managing the general budget of a team.
In Tempo Folio: There are two ways to do this within Tempo Folio. You can choose to plan your budget based on either the staff member’s availability or their planned effort.
If you choose this option, then you first need to have defined your folio’s staff. You can do this by associating the staff of a previous folio with the current one, adding a Tempo Team that you have already created in the Tempo Teams space, or creating a new staff for this folio.
Once your planned costs are entered in any of the above ways, then you have a project baseline ready and you can get started tracking the actual costs of your project in real-time.
If you have a budget to plan and you're stuck on exactly where to start, try thinking about one of the above options and see if the rest of the information falls into place.
If you need more information on how to plan the costs of your folio, take a look at the following video: