This Guest paper was submitted for publication and is copyright to Roger L. Parish, PMP, © 2013.
published here August 2013.
It is an update to the paper, "PMBOK® Guide Fourth Edition - Unraveling Project Reserves", published by the author in March 2010.

PART 1 | Introduction | Adding Time Contingency Reserves
Project Performance (Earned Value) Reporting
A Final Thought for PMI and the PMBOK® Guide | Conclusion


If there are major takeaways from this discussion of how to manage project reserves, it would be that first, contingency reserves and management reserves are important concepts that anyone managing projects should understand. This includes understanding that realistic budgeting and scheduling must allow for contingencies. Failure to address and plan for contingency and management reserves most certainly increase the risk that the project will not complete on time and on budget.

The second is that the way in which performance is reported must be driven by the needs of the audience. In particular these needs are centered on the types of decisions each must make. Executives make very different types of decisions compared to project managers. Thus, the way in which the data is accumulated and reported should be tailored to meet each audience's or stakeholder's needs.

Simply stated, there is no "one size fits all" solution. Rather, it is incumbent upon project managers, mid-level managers, and senior executives to understand these concepts so they can mold them into policies that best serve the needs of each as well as the organization overall.

Finally, I recommend that management should be able to allocate management reserves for scope changes, as well as the other reasons provided for by the Guide. However, management reserves should only be released to the project through the formal change control process.

A Final Thought for PMI and the PMBOK® Guide  A Final Thought for PMI and the PMBOK® Guide

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