Budget Planning and Development
Budget planning and development is essential to any project regardless of its size and scope. It is a process that starts during the early stages of the project life cycle and long before construction actually starts. From a client perspective, this would be done in the form of a feasibility study or functional programming. The goal here is to establish a realistic budget for the planned project based on the information known at that given point in time.
The process of budget planning and development would be influenced by one of the following client scenarios, which are typical:
- A fixed budget or funding is allocated and there is a need to determine whether the project scope requirements could be achieved;
- With established scope requirements, determine the budget outcome based on these requirements.
The typical construction budget includes all items defined as Hard Construction Costs, while the project budget includes additional items defined as Soft Costs. At this initial stage of the project life cycle, the cost estimates required may be defined as rough order of magnitude (ROM), Class D, or Indicative.