Unlike most engineering projects, software projects require technical skills and people skills to understand and align expectations between different stakeholders. Another peculiarity is that until the validation or delivery of the project, stakeholders are left with wireframes and software specifications. Given those challenging factors, how to improve budget management for trucking logistics software projects?
By João Ricardo Gubolin, Chief Business Development Officer · December 29, 2022.
Define the End Goal – Well Defined, Timely, and Business-Value-Oriented
At the beginning of software projects, most trucking logistics companies often have predefined goals and expectations they want to achieve with their investment. With this in mind, it is easy to lay out all of those at the very beginning of the project. However, as important as they are, trucking logistics companies must elect at the very beginning the least deliverable that will yield the highest return in the shortest time frame possible. This can quickly be done with the MVP – short for Minimum Viable Product – concept.
Define the MVP
MVP is a framework extremely helpful in improving budget management for software projects in trucking logistics companies. Using MVP, project stakeholders can design a product that delivers the most business value in the shortest time possible to yield the highest return on investment. An MVP must be relevant to its users but feasible to be deliverable in the shortest time frame possible by an engineering team’s realistic capacity. When talking about time, it isn’t easy to specify a time frame, but I like to use the following line of thought: one week may be too short, one month may be ok, but one year might be too much for the first MVP delivery of a software project.
Dimension the MVP
By dimensioning the MVP, stakeholders can align expectations of how much the first trucking logistics software project delivery will cost, the expected yield rate, and the timeline for that investment. A project can be dimensioned using hours, days, weeks, months, or sprints. A sprint is a set of deliverables within an MVP that can be attached to a short timeframe, typically one to two weeks. The advantage of using sprints over the other measurement references is that it allows teams to create their pace of delivery. Further, when the resources employed on a sprint for a specific time frame have their cost added up, this results in the total cost of a sprint.
Use Prior Experience to Allocate Risks
Usually, the team about to develop the MVP has prior experience in other projects within a trucking logistics company. This track record shows what deviances happened on past deliveries. Then, when this deviance (risk) is applied to commitments made throughout the project, managers can keep a track record and use it to enhance team members’ feedback. To make it easier to apply risk to an activity, ask each professional of that project what the effort and deadline for its delivery are. Separating effort and deadline allows an additional perspective on productivity. The effort is how many hours an activity is expected to take. The deadline is the date and time when it is scheduled to be finished. With this detailed activity broken down, the MVP’s budget management improves significantly.
Given the complexity of software projects, trucking logistics company executives should learn as much as possible about managing projects’ budgets efficiently and effectively. By using MVPs, risk allocation, and breaking down the wants and needs of stakeholders, decision-makers can use several software project management concepts and tools to improve budget management.
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