In some organizations, budget reserves and schedule buffers are taboo. I have heard countless arguments on both sides of this issue. I am an advocate of doing what makes most sense for the organization, its culture and its valuable human resources. Those which conduct a multitude of complex, highly scrutinized projects (e.g., risky contracts), and are genuinely concerned about the culture and people, will find a way to ensure that they give their project teams all the opportunity they can to be successful – even in conjunction with the goal of “doing more with less.” Budget reserves and/or schedule buffers can help enable this if established with the right expectations, and diligently controlled. There are tried and proven methods of doing this, and I provide general guidance and instructions on how to do so in my book, “Project Risk Management: A Practical Implementation Approach.” It is all about risk management – understanding and accepting that even the best teams are likely to experience the impact of materialized risks (i.e., issues) on inherently complex projects, and thus, they should have mechanisms in place to help themselves recover. Unknown unknowns are a reality to contend with – they are typically too spurious to identify up front, and tend to require more (rather than less) resources up front to pro-actively try to address. Issues which arise due to their occurrence have to be effectively resolved for projects to succeed, and there are valid ways of quantifying, up-front, the expected amount of budget reserve and/or schedule buffer to plan for.
The objective of this series of posts is to provide insights into the breadth of Holistic Project Risk Management, especially as it relates to satisfying an organization’s objective to “Do More with Less” – which, if done well will improve the organization’s business success. The plan is to provide 2 posts per week over the course of 10 weeks. Thus, there will be time in between topics to comment and/or reach out to the author for clarification or further requests. Past posts will be assembled and stored on the Build2Scale.net website for future reference.
My text book “Project Risk Management: A Practical Implementation Approach” can be purchased via the following link: