Project Management

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You’re walking past a construction site and spot: “Budget: €513,282.55.” As a PM, do you smile, cringe… or start doing mental calculations?

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Eduard Hernandez
Community Champion
Product Operations Program Manager Barcelona, Cataluña, Spain
During a recent trip to Southern Europe, I noticed a large sign announcing the renovation of a public building. Alongside the usual information — project title, contractor, timeline — it displayed a strikingly precise budget: €513,282.55. Seeing that number made me wonder: what’s the instinctive reaction of other project managers when they encounter such exact budget figures in a public setting?
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Keith Novak Tukwila, Wa, United States
Knowing that level of precision is fake leads me to believe that the person who put it there is wasting money trying to show off but achieving the opposite to anyone who knows better.

Why is that level of precision fake? Because the time value of money means the number is constantly changing due to cash flow and the interest rate on either the loans or the capital in reserve used to pay for the project.

It reminds me of a US saying, "If you can't dazzle them with your brilliance, baffle them with your bullsh*t."
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1 reply by Eduard Hernandez
Aug 10, 2025 1:18 AM
Eduard Hernandez
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Great saying, I will remember it! 😃 Thanks, Keith.
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Eduard Hernandez
Community Champion
Product Operations Program Manager Barcelona, Cataluña, Spain
Aug 09, 2025 2:08 PM
Replying to Keith Novak
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Knowing that level of precision is fake leads me to believe that the person who put it there is wasting money trying to show off but achieving the opposite to anyone who knows better.

Why is that level of precision fake? Because the time value of money means the number is constantly changing due to cash flow and the interest rate on either the loans or the capital in reserve used to pay for the project.

It reminds me of a US saying, "If you can't dazzle them with your brilliance, baffle them with your bullsh*t."
Great saying, I will remember it! 😃 Thanks, Keith.
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Thomas Walenta Global Project Economy Expert Hackenheim, Germany
I understand that a PM mindset is not guiding the world. There are also mindsets and perceptions of accountants, politicians, bureaucrats, and people simply passing by the site.
If that is the exact amount their funders have given them, transparency demands that it be disclosed. You might be surprised if they meet this budget to the cent.

Projects should be seen from several angles.
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Sergio Luis Conte Helping to create solutions for everyone| Worldwide based Organizations Buenos Aires, Argentina
Make the right prompts (questions) to ChatGPT of to Infinity (just in case, as I understood, it has kwnoledge base on projects. I do not know how to assure that) and you will can work on that. If you will use ChatGPT you need to be aware on Responsible AI (expose company expecific date and others).
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Kiron Bondale Retired | Mentor| Retired Welland, Ontario, Canada
Eduard -

The degree of precision is driven by the level of confidence in the cost of the work being done, the complexity of the project, and its size. Whenever I see any budget over 100 with anything reflected past the decimal point I don't have a high degree of confidence in how that number was derived.

The one exception would be a true fixed price project where there is simply no more money to be found to fund changes. It is possible this amount represents the original approved costs plus whatever left over funding was available from other completed projects and someone from the finance department might have told the PM, "Here's the maximum amount you will be able to spend". In such cases, that reflects the funding envelope but not the true cost of what it might take to complete the project.

Kiron

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