First Schedule, Then Budget

What should come first…the schedule or the budget?  I’m not sure how your organization is run, but most organizations that I’ve been associated with have had a sales or account manager aspect that worked with the outside project client to establish the services to be rendered, came up with a draft schedule and a price, and then handed it all to me when the deal was closed.  What I ended up with was a shell of a project schedule that showed we basically understood what needed to be done, and then a price to match it to.  That’s not the best way to do it, that’s why the project manager sometimes gets a frustrated customer with expectations that don’t match the price or the schedule and that’s why a project manager should always be involved at the beginning of customer engagement – not just once it becomes a project.

So let’s consider the other scenario – the scenario where a project manager engages a customer (internal or external) and initiates the entire engagement with them.  In this type of situation, still many project managers are inclined to start with the budget first, but that can be a dangerous way to start the planning and estimating portion of the project.  Why?  Because time is money and everything that goes into the project schedule – every single task, every expensive resource assignment, every deliverable review process and signoff…everything – will cost money and that will affect the budget.  That’s why I say, schedule first, then budget.

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