● Operational Excellence · Instrument 03 · v1.1
The Project Budget
Price a project to a margin before you sell it, track it while it runs, and know what you really made — a rate card and four faces of one grid. The manual, and the template that is the instrument.
Why it matters
Professional services firms lose money one project at a time and find out at the end of the quarter. The project budget finds out before the proposal goes out and keeps finding out every week until the invoice is paid. One rule — no project is priced without a budget, and no budget is accepted below the margin floor — and one sheet to enforce it.
What’s inside
Price it to margin. The rule, the floor, the rate premium, and the change-order discipline that took a digital agency from one million in billings to ten.
The rate card. Salary to hourly, loaded cost, target rate, two margins — the one that flatters and the one that is true — and the rate below which a role loses money at the floor.
Budget — the plan. Hours by role by month, priced at cost and at rate, with the margin before anyone has said a number to the client. The worked example: 1,152 hours, 64.4% against a 64% floor.
Track — the run. Hours actually spent, typed weekly; remaining by role; run cost and run sale. The same project at 1,230 hours.
Performance — the verdict. Plan against actuals by role and by month; realized margin 61.8%, actualization 107%, a cost overrun in pieces no larger than twenty-four hours. Nothing typed.
Change orders. New hours in the grid, dated; invoiced or eaten knowingly, no third outcome; approved against margin and capacity both. The sentence to teach every project manager.
Standing it up. Ninety days — the card and the floor, every proposal, the verdict monthly — and the two failure modes. The template, tab by tab, and the checklist.
How to use it
Build the rate card first, from the real accounts, and show the floor to sales. Give every proposal a Budget tab and every live project a Track tab updated to last Friday. Read Performance monthly and revise the card from it. Pair it with The Capacity Model; each stands alone.
Provenance
The project budget discipline I built and ran at a digital agency, 2010–2015; rebuilt in 2025 as a tool for a creative agency that could not see its margin; rebuilt here as a Juan.co instrument with a sanitized template: sample roles, round numbers, a worked project, the formulas intact.