Effective Budget and Resource Management Plan


Added on  2019-09-22

4 Pages1072 Words478 ViewsType: 478
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 this approach, all the aspects come from the top i.e. the top management level. The objectives of the project were designed by the top management. The top managers gave all the guidelines and plans in order to complete the project. In this approach, top managers are the ones who are responsible for the failure. Earlier the managers were confused that which they should use as there was chaos in the management team and there were more failures in the system of project management. Then the team decided to come up with the top-down approach by appointing top level managers. This approach helped in estimating the cost correctly. As there were very fewer changes in the original budget and the updated budget of the project management. The project team easily maintained the updated budget without any problem. The top-down approach helped the project team in every possible way whether it is about estimating the budget, dividing the work among the team members and the volunteers, etc. Below is the table which will give the clear understanding that how the top- down approach helped the project team effectively. The difference between the original budget and the updated budget will show the effectiveness.2.BudgetCategoryOriginal budget(Charter)UpdatedbudgetExplanation of the difference between the two budgetsEstimated Labor$2,000$2200The difference is of $200 as we will be hiring more labor in order to carry the equipment more effectively.Estimated Materials$3,000$3100The difference is of $100 as we require more materials in order to effectively develop the stage
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of the performers.Estimated Contractors$1,000$1500The difference is of $500 as we require more contractors to get the resources.Estimated Equipment and Facilities$10,000$11,000The difference is of $1000 as werequire more equipment in order to complete the carnival effectively.Estimated Travel$4,000$3900The difference is $100 as we saved our money in the travelingexpenses because maximum people will be coming by their own vehicle.Total Estimated Cost$20,000$21,700The total difference in the actual budget and the updated budget is$1700.3.Budget Contingency PlanContingency amount We will be keeping the contingency amount of 7% of our budget for the project management because if any unforeseen event occurs then, we will be able to handle it by keeping the contingency amount aside. If we do not do this, then our project will get badly impacted. We have 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 of stealing the important information, fire, mismanagement in the labor and injuries while handling machines and equipment. Our team doesn’t want that our project gets affected by these unforeseen events as it will incur huge cost and loss to our project. So we want to be prepared in advance in order to deal with such type of events. There are chances of fire because we are hosting a carnival and the venue might catch fire as there will be stoves for the food and beverages. There might be mismanagement and chaos among the labor which might affect the usage 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
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