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Part 1: Managers Need To Learn Language of Finance
Part 2: Understanding Key Financial Management Terms
Part 3: Making the Financial Case for Projects
By Andrew Gager
February 2017 -
Facilities Management Article Use Policy
When formally and professionally presenting the proposal, managers need to include an executive summary of the overall spending, adding details, time frames, and milestones when possible. They also should include the financial spending report with solid, quantifiable analysis. It is important to always get confirmation of the numbers from an independent internal or external financial analyst.
Whenever someone in my organization came to me with a proposal for capital spending, the first person I went to was our CFO to confirm the numbers. If managers can get someone to validate the numbers first, they’ve won half the battle.
They also should include assumptions, as well as an appendix with more details of the project, other similar projects as reference, white papers, or their own analysis that validates the proposal. One proven tactic for success is to review previous proposals that received funding to find ideas on making the strongest case.
Managers can select from among hundreds of readily available articles, white papers, and studies on capital project successes and failures, but three mistakes are consistently mentioned: failing to get accurate time and cost estimates, failing to establish measures, and evaluating and proposing large capital projects without sufficient detail.
One problem rarely ruins a capital project. It usually takes a series of failed steps along the way. The best projects are on time and under budget while meeting everyone’s expectations.
Andrew Gager, CMRP, CPIM —
firstname.lastname@example.org — is director of Asia and Australia with Nexus Global Business Solutions. He has more than 28 years of manufacturing and facilities experience, ranging from warehousing operations to plant management. He is a registered CMRP, CPIM and Six Sigma Green Belt, and he is formally trained in change-management principles.