Monday Oct 22, 2012

Smarter Ways to Unlock Your Unused Contingency Budgets

Cash flow is becoming increasingly important in the current economy; senior executives are looking for smarter ways of unlocking unused funds for new or ongoing capital expenditure projects. With project contingency budgets on average equaling 10 percent of overall costs, are you confident that you can release this cash without risking existing investments or the health of your overall project portfolio?

This is the central question posed in a new report from the EPPM board,
Hedging Your Bets? Optimizing Investment Opportunities for Great Cash Flow. The board is Oracle’s international steering committee, which brings together senior figures from leading organizations to discuss the critical role of enterprise project portfolio management (EPPM).

C-Level Visibility Will Unlock Funds
In addition to exploring how unlocking your contingency funds enables you to augment your cash flow (without resorting to expensive borrowing), the report offers a number of suggestions on how this can be done in a risk-free way, including

  • Building an effective governance framework that shows the demonstrable value of every project within the portfolio
  • Undertaking contingency planning risk assessments that give you complete portfolio wide visibility into all risk factors
  • Establishing executive ownership of the portfolio to promote a more realistic appreciation of the risk levels inherent in the portfolio
  • Creating a chief risk officer role that can review consolidated contingencies and risks so they are not considered in isolation

The overriding message behind the report—and the work carried out by the EPPM board—is the need for increased C-level visibility across the entire enterprise project portfolio to enable better business decisions.

Read the complete report in English, Chinese, German, or French.

Read more in the October Edition of the quarterly Information InDepth EPPM Newsletter

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