Budget and Resource Management Plan.
Added on - 22 Sep 2019
Budget and Resource Management PlanProject Budget1.Estimation MethodsThe method which we used in our project in order to come up with our cost estimate is the top-down approach. The top- down approach is commonly used in the project management. In thisapproach, all the aspects come from the top i.e. the top management level. The objectives of theproject were designed by the top management. The top managers gave all the guidelines andplans in order to complete the project. In this approach, top managers are the ones who areresponsible for the failure. Earlier the managers were confused that which they should use asthere was chaos in the management team and there were more failures in the system of projectmanagement. Then the team decided to come up with the top-down approach by appointing toplevel managers. This approach helped in estimating the cost correctly. As there were very fewerchanges in the original budget and the updated budget of the project management. The projectteam easily maintained the updated budget without any problem. The top-down approach helpedthe project team in every possible way whether it is about estimating the budget, dividing thework among the team members and the volunteers, etc. Below is the table which will give theclear understanding that how the top- down approach helped the project team effectively. Thedifference between the original budget and the updated budget will show the effectiveness.2.BudgetCategoryOriginalbudget(Charter)UpdatedbudgetExplanation of thedifference between thetwo budgetsEstimated Labor$2,000$2200The difference is of $200 as wewill be hiring more labor inorder to carry the equipmentmore effectively.Estimated Materials$3,000$3100The difference is of $100 as werequire more materials in orderto effectively develop the stage
of the performers.Estimated Contractors$1,000$1500The difference is of $500 as werequire more contractors to getthe resources.Estimated Equipment andFacilities$10,000$11,000The difference is of $1000 as werequire more equipment in orderto complete the carnivaleffectively.Estimated Travel$4,000$3900The difference is $100 as wesaved our money in the travelingexpenses because maximumpeople will be coming by theirown vehicle.Total Estimated Cost$20,000$21,700The total difference in the actualbudget and the updated budget is$1700.3.Budget Contingency PlanContingency amountWe will be keeping the contingency amount of 7% of our budget for the project managementbecause if any unforeseen event occurs then, we will be able to handle it by keeping thecontingency amount aside. If we do not do this, then our project will get badly impacted. Wehave to be prepared for such events in order to get success in our project.JustificationOur team has selected the contingency amount because in our project there are chances ofstealing the important information, fire, mismanagement in the labor and injuries while handlingmachines and equipment. Our team doesn’t want that our project gets affected by theseunforeseen events as it will incur huge cost and loss to our project. So we want to be prepared inadvance in order to deal with such type of events. There are chances of fire because we arehosting a carnival and the venue might catch fire as there will be stoves for the food andbeverages. There might be mismanagement and chaos among the labor which might affect theusage of resources. The laborers may get injured while working on the site of the venue.Therefore, we will take care of their safety completely but still the unforeseen event happens; wehave contingency amount.Resource Management