Creating a realistic agile project budge – case study – customer implementation

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How to handle agile projects budget through the agile project process?


Big organization, highly respected in the industry, conservative approach to the financial world, highly regulated.

1000+ tech employees

Yearly road-mapping, upfront budget allocation for projects.

Big projects.

For Some of the projects agile methodology was selected. Others are to come.

What are the challenges with agile budgeting vs traditional budgeting?

  • Project scoping and planning are in high level and details are added continuously during the project . meaning, you DON’T know detailed budget needs up front . meaning, The feeling level of uncertainty is low = anxiety.What are the needs of agile project budgeting?
    • Calculate an accurate budget that considers all key elements required by the stakeholder, in terms of both cost and time .commitments.
    • Establish processes that enable the budget to be flexible, in terms of .swapping features/elements in and out following stakeholder feedback, so the project can remain Agile without going over budget.

How to Calculate Agile Project Budgets (and Stick to Them)

What is the changed mindest needed to be able to manage agile budgeting?

  • The feeling of low level of uncertainty= anxiety . this means working in agile requires high level of trust.
  • Stakeholders engagement and collaboration needs to be continuous and frequent
  • Collaboration needs high transparency and realistic/honest forecasting-

Traditional vs Agile budgeting:

  • Traditional Budget:
    • Scope is fixed
    • Budget/timeline usually change
    • Planning is detailed , E2E to the detailed and upfront
    • Dealing with changes is tough , demands complex , retroactive detailed effort and costly
    • Hard to identify budget slips – only at the end
  • Agile Budget
    • Budget/timeline are fixed – assigned a head and set as a baseline
    • Scope is changing according to value delivered
    • Planning
      • High level upfront
      • Continues scoping
      • Detailed level just in time
      • Continues budgeting calculation comparing to baseline
    • Ability to identify budget slips early – we keep tack od deliver scope and update budget burn chart

The agile project process (focus only on what’s relevant to the budget issues)

Project budget burn chart:

1. Initiation process

A set of meeting short and quick or lost of meetings where their goals are to finalize HL project vision , value understanding before discovery = relevant to all projects (agile & NON agile).

Quick fix overall budget, timeline

i. Size of High level scope (as described in the project one pager). This will define the project baseline

ii. Any scope change ahead should fit the initial Budget baseline size already set.

iii. Planning initial timeline: By when the transformation has to get completed (range).

iv. Assign formal budget baseline and HL numbers. 

2. Quick Asses readiness for an Agile project

i. Business and steak holders defined project one pager : main vision, main value , main activities.

ii. Make sure depends Stakeholders and gate keeper’s engagement’s and Trust are high.

iii. Stakeholders and gate keeper’s understand the agile concepts and willing to participate

iv. Stakeholders and gate keeper’s allocate resources and time for discovery and grooming

v. Stakeholders and gate keeper’s signes up to provide feedback during the entire project .

3. HL short Project Pre discovery once , and ongoing for each MVP/F

i. Main Players: Project Initiator – business, Relevant VP, relevant tech authority , set by project manager

ii. Inputs:

  • Company business objectives
  • Business need
  • One pager

iii. Process:

  • The process should be as short as possible, to save efforts before the Go/No-Go decision.
  • limit the project to small chunks of valuable work (you can call it a PI ot phase or an MVF…) – Projects bigger than 9 developer months should be broken to multiple sub-projects (phases).
  • Baseline the projects’ value assessment and contribution to the organization objectives must be clearly explained (the WHY justification for the project).
  • Deepen Understanding of budget issues , research needs , other blockers and dependencies.


iv. Again Go/No-Go Desicion:

  • Does it answer real business need or captures a real business opportunity?
  • Do we assess it will bring high business value?
  • Who are the Business owner, tech lead , gate keepers involved?
  • What is the proper time to move Discovery.
  • What we need to do and what it will take to deliver it (high level understanding of the product and an initial High level estimation of the effort).
  • What is the suggested budget – HL budget baseline approval- again.
  • What are the plan for risks, depedencies and other open issues?
  • HL plan
  • Set budget burn chart

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Disclaimer: The views shared here are my own. Assistance from a language model was employed for organizing and summarizing my thought. Some of the accompanying images were created using AI technology.

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