Report Sample on Creating a Project Budget

Introduction

A budget aggregates the estimated resources used, the goals, and the activities' schedule to get a cost baseline. There is an interdependency between the work breakdown structure, project schedule, and the project budget. The work breakdown structure outlines the activities that the project entails. In contrast, the project schedule shows the sequence in which the actions will be executed, and the budget assigns resources to the scheduled activities (PMBOK® Guide,2017).

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The budgeting method used is bottom-up budgeting. The project manager drafts a budget covering direct and indirect costs to project activities, and submits it to their superior to eliminate double counting or overlap. When developing the budget, the project manager has to consider their departmental needs and the firm's project requirements; this increases the chances of their budget being approved by top managers. Activity-based costing is used to derive accurate cost estimates. It entails assigning costs to activities that consume resources, identifying the cost drivers associated with the action, compile a cost rate per cost driver unit and allocate costs to the project by multiplying the cost driver rate times the cost driver units consumed by the project.

Every project incurs direct and indirect costs. Direct costs are related to an acquired product, activity, or service, making it traceable compared to indirect costs that are very hard to assign (Board, 2015). Therefore, indirect costs will be included in the corporate or production overhead regardless of its creation.

Work Breakdown Structure

Creating a work breakdown structure is the process of subdividing project deliverables and into smaller, more manageable tasks (Pinto,2015). The first step in creating a WBS is identifying the deliverable such as issuing of newsletters, advertising on publications, team members attending the annual trade show to introduce the product, press releases, and updated collateral acquisition.

Issuing Newsletters

The newsletters have to be printed out with information and pictures of the upgraded product, and the day the upgraded product will be available for purchase. The director has to approve the quality of the newsletters then they can be distributed. The order of activities is as mentioned above. The activities depend on each other chronologically as you cannot issue out newsletters without printing, and the content in the newsletters has to be relevant to the upgraded product. Preparing for the issue of newsletters can take two weeks and should be allocated $500 to start the activity. It should be the first activity to be implemented as it reaches more people and offers more information about the product

Advertising

The publishing companies should first be approached, and their quotation is taken for comparison. Then the team's creatives should provide the information to be included, and once the publication is out, payments should be made if the company delivered what was asked of them. This deliverable can be actualized in one month and may cost up to $2,000; because the activities are being outsourced. This can be done simultaneously while the other deliverables go on as it is not very involving.

Team Members Attending the Annual Trade Show

The team members can prepare their presentation before the trade show and attend the trade show on the set date as they cannot influence it to be changed to their convenience. The team members can issue the newsletters during the trade show, which will increase the population reached, and the information passed across. These activities will cost $400, catering to the team members' tickets and reaching out to more customers by putting up a useful and attractive station.

Press Releases

Press releases will involve the team members pulling all their string to get all the possible viewing so that the releases can be efficient as marketing strategies. If the budget is forthcoming, media houses with high ratings can be invited to feature the product. Such a move will bring new customers to purchase the product, which is the project's primary goal. Executing this deliverable may take up to six weeks and should come after some knowledge about the upgraded product is out. Hence it will be the fourth deliverable to be actualized. The activities involved will cost $2000 for the targeted audiences to be reached

Conclusion

Updated collateral is obtained to help evaluate the population that has been reached. It will be the determinant of whether the marketing strategies applied were effective and their delivery quantified. The deliverable will be executed after eight weeks when all the other marketing strategies have been completed. Actualizing this deliverable may cost $500 because a sample population can be used to have an estimate of what percentage of the population was reached. The team members can then conclude on whether to continue marketing and which marketing strategy will be efficient.

The major milestone in executing the given deliverables would be to reach the targeted number of people within six weeks. It is a milestone because if achieved, then marketing would have brought in the results that were expected and within the given budget.

References

Board, E. (2015). Global Financial Management. [American Intercontinental University]. Retrieved from https://aiu.vitalsource.com/#/books/9781943926008/

Pinto, J. K. (2015). Project Management. [American Intercontinental University]. Retrieved from https://aiu.vitalsource.com/#/books/9780133798241/

PMBOK® Guide (2017). A Guide to the Project Management Body of Knowledge (PMBOK® Guide)–Sixth Edition. [American Intercontinental University]. Retrieved from
https://aiu.vitalsource.com/#/books/9781628253900/.