Project Management Central

Please login or join to subscribe to this thread

Who approves the project budget for project executing?
Network:169



PMBOK 6th does not mention on this thing. It makes us a lot of confusing. If I am a freelancer, is asked to issue a quotation, for developing an application project. After many iterations, the buyer agrees my proposal ($10,000), so is this the project budget?
Sort By:
Page: 1 2 3 next>
Network:1196



yes, the project budget is approved by the Sponsor, the person authorised to sign the PO.
...
1 reply by Truc Pham Trung
Feb 03, 2019 12:56 AM
Truc Pham Trung
...
Tks you, Roman.
Network:652



Hi Truc,
To understand, obser this activity from one level higher and from buyer side. In your case buyer is executing procurement management activity. Buyer add your final agreed proposal price to arive his project budget.
However from your side or seller side this is total money you will get from buyer after successful delivery of product or service as agreed. For seller thia includes their profit and other overheads. Further to execute this project from your side or seller side you need to finalise your project budget excluding profit and others and sane will be agreed by your top management or project sponsor. After the approval this is your approved budget for delivering product or service as agreed with buyer.

Hope I clarify you !!
...
1 reply by Truc Pham Trung
Feb 03, 2019 1:02 AM
Truc Pham Trung
...
Yes, totally agree on your idea. So customer can be a sponsor? From my viewpoint, customer is ALWAYS an external stakeholder, sponsor is ALWAYS an internal stakeholder. Customer no ptovide resources for the PM to implementing the project, they just follow the contractual agreements to pay for the our company. Do you agree?
Network:169



Feb 03, 2019 12:14 AM
Replying to Stelian ROMAN
...
yes, the project budget is approved by the Sponsor, the person authorised to sign the PO.
Tks you, Roman.
Network:169



Feb 03, 2019 12:18 AM
Replying to Alok Priyadarshi
...
Hi Truc,
To understand, obser this activity from one level higher and from buyer side. In your case buyer is executing procurement management activity. Buyer add your final agreed proposal price to arive his project budget.
However from your side or seller side this is total money you will get from buyer after successful delivery of product or service as agreed. For seller thia includes their profit and other overheads. Further to execute this project from your side or seller side you need to finalise your project budget excluding profit and others and sane will be agreed by your top management or project sponsor. After the approval this is your approved budget for delivering product or service as agreed with buyer.

Hope I clarify you !!
Yes, totally agree on your idea. So customer can be a sponsor? From my viewpoint, customer is ALWAYS an external stakeholder, sponsor is ALWAYS an internal stakeholder. Customer no ptovide resources for the PM to implementing the project, they just follow the contractual agreements to pay for the our company. Do you agree?
Network:2423



whoever pays for the project will approve the budget, your quotation may not be the complete budget for the project it is your contract price for a set of predefined scope to deliver.
Network:1882



Inside the PMBOK, the input to the first process is an approved business case. Business case creation and approval is outside the project manager scope of work. It is a business analyst role accountability. You can go to the PMIĀ“s documentation about business analysis to find it.
Network:2740



Project Sponsor approves the Project Budget.
Network:1224



Project Sponsor approves the Project Budget
...
1 reply by Truc Pham Trung
Feb 03, 2019 10:19 AM
Truc Pham Trung
...
Thank you Ravi and Ansari. Is it always? Never by customer? Tks.
Network:169



Feb 03, 2019 9:35 AM
Replying to Ravi Kishan Paliwal
...
Project Sponsor approves the Project Budget
Thank you Ravi and Ansari. Is it always? Never by customer? Tks.
Network:1882



@Truc, besides the academic component, answer is simple: who will pay for that? She/He is who will approve the budget.
...
3 replies by Sergio Luis Conte and Truc Pham Trung
Feb 03, 2019 10:39 AM
Truc Pham Trung
...
Thank you, Sergio. Any place in the 6th mentioned on that? I did not see in the 6th. From my understading, always is sponsor, an internal stakeholder.
Feb 03, 2019 11:08 AM
Sergio Luis Conte
...
You will not find it inside the PMBOK because is outside of the PMBOK scope. Perhaps you will find an answer if you see a table inside the PMBOK (I do not remember the page) related to "who manage the project budget?". The problem with the PMBOK is the term budget that is incorrect because as you see all inside the PMBOK is related to cost which are a component of the budget only. So, as project manager, you will calculate the cost component of the budget, not the budget itself.
Feb 04, 2019 10:15 AM
Truc Pham Trung
...
Thank you!
Page: 1 2 3 next>  

Please login or join to reply

Content ID:
ADVERTISEMENTS

"Try not to have a good time...this is supposed to be educational."

- Charles Schultz

ADVERTISEMENT

Sponsors

Vendor Events

See all Vendor Events