With the help of such a project budget, you can respond to feedback

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Let's say a company is creating a smartphone app. The managers calculate the project budget, but during the development of the app, there is a need to add a new function, and this requires money.

A flexible budget will allow the company to quickly respond to such changes. For example, if competitors launch a new feature, the team can reallocate funds and adjust the budget to include this feature in their product.

In the early stages of working on a new product, it is difficult to accurately predict all costs. A flexible budget provides reserves for unexpected expenses, such as testing, marketing, and developing new features.

Benefits of flexible budgeting:

and wishes from users, clients or customers.
A flexible budget creates room for experimentation. When a team sees uk phone number list that certain features will require more time and resources, they can allocate funds to experiment with new ideas that will help improve the product.
Such a budget enables the company to respond to changes in external conditions: the emergence of new competitors, changes in the market situation.
But this method also has its drawbacks. First of all, the risk of overspending. It is important to ensure that project participants do not spend money on non-working hypotheses or unnecessary features for the product. Therefore, when using a flexible budget, the company should regularly analyze current expenses, otherwise the profitability of the project will be at risk.

Combined budget
A blended budget combines the stability of a fixed budget with the flexibility of a flexible budget. It allows the project team to commit to baseline costs in advance, while still allowing room for change as circumstances change during the course of the project.

A combined budget, for example, is suitable for a construction project. The method can also be used to manage projects of IT companies. To do this, during the development of a new product, the team needs to identify fixed costs. These can be costs for employee salaries, rent of office space, equipment and software licenses.