When it comes to communicating project budget information effectively to your stakeholders, including executives, clients and of course your team members, it is important to ensure that the way in which you communicate is clear and understandable. You also need to ensure that all of the required information is provided. For many project managers, this can be a challenge, particularly in those instances where the stakeholders have different levels of financial involvement, expectations and interests. In this short guide, we will look at how you should be effectively communicating budget information to your stakeholders and answering any questions or concerns that they might have.
Know your audience
Before you can even begin to create and then share your budget you must first understand exactly who your audience consists of, and exactly what it is that they want to know from you. Different project stakeholders will want to know different details. They may have different concerns and questions and even priorities regarding your budget.
- Donors– those who are donors may wish to know how funds are allocated, how you measure impact and what your approach is to handling risks and contingencies.
- Partners – those who are partners on the other hand, may want to know how you will collaborate and coordinate with them. They also might want to know how cost and responsibilities will be shared. Furthermore. They might want to know how you will align both your strategies and your goals.
- Beneficiaries – this group may want to know how you will address any needs and preferences that they have. Also how they will be involved in your decision making and how you will make sure that there is accountability and transparency in the project and your decision-making.
- Staff – this final group may need to know how you will plan to support their work and development, and also how you will encourage an inclusive and positive culture.
With a number of different groups of stakeholders involved in your project, you need to ensure that you understand each one. Then, make sure you are effectively tailoring your budget communications so that you can meet the needs and expectations of each group.
Use language that is simple and clear
One single and common barrier that many have when it comes to effective communication is using too many technical terms and jargon. As a project manager, this may be the terminology that you are used to but many of your stakeholders will not be familiar with it.
Ensure that all of your communications are made in language that is clear, simple and that your audience can relate to and understand. You should avoid the use of acronyms, abbreviations and any complex formulas unless you explain them. Plain English is always best and avoid the use of idioms and slang. For the clearest communication, use short sentences and the active voice.
Key terms and assumptions should be defined, and scenarios and examples are a good way of illustrating your point. To make your budget more accessible to all and, therefore, more engaging using metaphors and analogies can be a good idea.
Choose the right tools for communicating project budget details
The format and tools that you use to communicate project budget details are another important factor. Depending on the audience you are communicating with, the purpose of your communication and the message you need to convey, then you may need to use a number of tools and formats in order to explain your budget properly.
- Spreadsheet – this is a good way of showing a detailed budget breakdown,
- Chart – if you just want to show income and expenses, then this is a clear way of showing both
- Table – use this to show variances in your budget
- Narrative – this can be used to effectively show any budget justification
Other tools that are at your disposal for sharing your budget with your audience include:
- Website
- Newsletter
- Reports
- In-person meetings
- Presentations
It is important to choose the format and tools that are most appropriate to the needs of your audience as well as those that are within your capabilities. That way you can deliver your project budget information in an effective manner.
Highlight your key messages and takeaways
When it comes to communicating project budget information, you should make sure that you focus on any key messages and takeaways that you need your audience to not only remember but also act on. Too much information that is irrelevant can both overwhelm and confuse an audience.
Budget information should be organised and prioritised in a way that is both logical and coherent to your audience. This can be done by:
- Break it down – use headings, subheadings, bullet points and any other visual aids that will break your message down and make it easier to scan or read in its entirety.
- Be visual – use colours, different fonts, symbols and, where appropriate, icons in order to help emphasise the different items in your budget
- Figures – use graphs, charts, maps and any other forms of visual stimuli in order to help show the trends, comparisons and patterns in your budget
- Impact and value – you should also use stories, testimonials, quotes and any other appropriate evidence to show the value and impact of your budget
Invite questions and feedback
Just as important as the ways in which you communicate your project budget information to your stakeholders is making sure that the communication paths are not a one-way process. This means that you should make sure that your stakeholders have their say.
Once you have communicated all of the relevant information make sure that you offer your stakeholders the opportunity to give you any feedback and ask any questions that they might have. Suggestions, opinions and concerns are all important to ensuring that your project is as successful as possible and everyone’s voice matters.
Listen to what your stakeholders have to say. If you are not able to respond to a question without doing some additional work, then make a note of the issue. Remember to give a timeframe for coming back to them.
It is important that you should acknowledge the value of the input and involvement that your stakeholders give to the project and also that you effectively address any errors, gaps or misunderstandings that have arisen during the presentation of your budget.
In order to improve the entire process, be willing and open to learning what can help improve future budgets and communicating project budget information in a clear and concise way.