PMP Practice Questions #68
As a project manager in an Agile environment, you are tasked with developing a budget for a new software development project. The project is expected to span several iterations with a cross-functional team. Given the Agile principles, how should you approach the project’s budgeting process?
A. Estimate the total budget based on the comprehensive scope of the project, detailing costs for every feature and requirement identified initially.
B. Calculate the budget by estimating the cost of each user story in the product backlog and summing these to get the total project cost.
C. Determine the budget based on the team’s capacity, estimating the cost of each iteration based on the resources (time, skills, etc.) likely to be consumed.
D. Set a fixed budget at the beginning of the project, allocating equal amounts to each iteration, irrespective of changes in scope or resources.
Analysis:
As a project manager in an Agile environment tasked with budgeting for a new software development project, the challenge lies in aligning budgeting practices with Agile principles, especially considering the project’s span across several iterations with a cross-functional team.
Analysis of Options:
Option A: Estimate the total budget based on the comprehensive scope of the project, detailing costs for every feature and requirement identified initially. This option suggests estimating the total budget based on a comprehensive scope, including costs for each feature and requirement initially identified. However, this approach may not align well with Agile principles, which emphasize flexibility and adaptability. A comprehensive upfront budgeting based on detailed scope may not be feasible due to the evolving nature of Agile projects.
Option B: Calculate the budget by estimating the cost of each user story in the product backlog and summing these to get the total project cost. Estimating the budget by calculating the cost of each user story in the product backlog offers a more Agile-aligned approach. This method allows for flexibility and iteration, as user stories can be adjusted, added, or removed based on the project’s progression. However, assigning a direct cost to each user story may be challenging due to the variability in effort and resources needed for different stories.
Option C: Determine the budget based on the team’s capacity, estimating the cost of each iteration based on the resources (time, skills, etc.) likely to be consumed. Determining the budget based on the team’s capacity and estimating the cost of each iteration aligns closely with Agile methodologies. This approach considers the resources (time, skills, etc.) likely to be consumed in each iteration, offering a flexible and adaptive way to manage the budget. It allows for adjustments as the project progresses and as the team’s understanding of the work deepens.
Option D: Set a fixed budget at the beginning of the project, allocating equal amounts to each iteration, irrespective of changes in scope or resources. Setting a fixed budget at the project’s outset and allocating equal amounts to each iteration is a straightforward approach but may not be the most effective in an Agile environment. This method assumes a uniform distribution of costs across iterations, which may not reflect the actual ebb and flow of work in Agile projects. It lacks the flexibility to adapt to changes in scope or resource needs, which are common in Agile settings.
Conclusion: Considering the Agile environment and the need for flexibility in budgeting across several iterations, Option C (Determine the budget based on the team’s capacity, estimating the cost of each iteration based on resources likely to be consumed) seems to be the most appropriate. This approach is in line with Agile principles, allowing for iterative budget planning and adjustment based on actual team capacity and project progression. The other options, while viable in different contexts, do not provide the same level of adaptability and alignment with Agile practices as Option C.
PMP Exam Content Outline Mapping
| Domain | Task |
|---|---|
| Process | Task 5: Plan and manage budget and resources |
Topics Covered
- Agile Budgeting
