Squeezing the Most Out of Your Project Budget

January 26, 2009 from gantthead.com – “The economy is clearly the worst it has been since I entered the professional workforce in the early 1990s. I have been asked to cut everything from people to paper to pencils…

While there is great scrutiny against project expenses and hard business return, companies know they must continue to invest in good projects to position themselves when the economy recovers. The mantra of this year seems to be: Do more with much less. The question on everyone’s mind is clear: How can you deliver in the face of significant cost pressures?...”

180 View – The topic is a good one but the article could be better. The author says “Projects that are required should fall into one of three categories: efficiency drivers, revenue generators or mandatory regulations.” These are good but I would also include effectiveness drivers, which allow an organization to more effectively achieve their critical success factors or what they must do well in order to be successful.

The author also says “Efficiency drivers are those projects that focus on a company’s cost structure. These may include projects around software efficiencies, application decommissioning, alternate sourcing and hardware consolidation (just to name a few). However, the clear driver is operating cost reduction. The key is that over a short timeframe, the project should pay itself back many times over.” Unfortunately the reality is that it’s highly unusual for projects to generate that kind of ROI.

“During good times, hiring marquee consultants at high bill rates is no object. However, during these times, frugality is king. There are few consultants that are worth the value of a bill rate over $100/hr”. Paying inflated rates for consultants will be an issue in both good and bad times for any organization. As well, finding good consultants (other than lone wolves) at less than $100/hr is unlikely.