Is it project budget variance useful to calculate? For what?

[#1]

Calculating variance when managing projects is a basic and necessary task for various reasons, including forecasting and better planning. It's impressive how a simple mathematical action can make lives simpler.

If you're one of those lucky people managing your projects using Jira, and more specifically managing the budgets for different projects. Not having a tool for this end, and especially not having the opportunity to calculate such aspects, can sometimes be frustrating, given that this is usually siloed and calculated in other tools, such as spreadsheets.

To avoid this and standardize and centralize this information, the key is linking finances and the PMO teams to drive success.

What does this mean exactly?

As budget variance is the bridge between those two teams (finance / PMO), having the data whether a spending is healthy, risky, or off the rails, and letting the PMO decide which projects can be accelerated, which should be slowed down, and where funds should be reallocated, is where the magic of having this information under control, which is nothing more than a calculation between the planned budget vs what’s actually spent.

How to calculate project budget variance natively in Jira:

Natively in Jira, it isn’t possible to easily define a project budget with a structured forecast, and even less does it allow categorization of costs as CAPEX/OPEX, direct/indirect, or any other enterprise standard, with the opportunity to tie them to project work. Even though I've heard about interesting use cases, doing it by means of story points...

All of this makes it difficult to see at a glance, planned budget vs actual spent, and calculate the variance per category.

Bringing project budget plan and budget actual spent forecasts into Jira: This is where Budgety for Jira comes in by giving projects a financial structure, allowing you and your team to define a target budget, break it down into forecast lines that match your cost categories, and keep everything in the same place where Work items, Epics, and Spaces are already being managed. Forget about exporting data from Jira into spreadsheets to do that.

Once Budgety for Jira is acquired from the Atlassian Marketplace, comparing actual spending with the forecast becomes a day-to-day routine, letting you register project expenses and assign all of that to the right forecast lines.

If you want to get into the details on how to do this, keep reading!