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Representative POMs are described for Variance Management at each level of maturity.

1Initial

• Practice

  Rely on the best endeavours of assigned personnel.

2Basic

• Practice

  Report and investigate some variances.

  Outcome

  Budget variances are sporadically addressed.

  Metric

  % of budget variances addressed

3Intermediate

• Practice

  Systematically review all reported budget variances.

  Outcome

  Budget variances can be reviewed and corrective action taken.

  Metric

  % of budget variances reported and addressed

4Advanced

• Practice

  Measure, track and address budget versus actual spend for all stakeholders.

  Outcomes

  • Tracking allows for stakeholders to apply corrective actions to realize business benefits.
  • Proactive review and management of variances results in action taken to reduce cost / rebalance the IT budget.

  Metric

  % of projects where budgets are compared to actuals and corrective action taken to address any variances.

• Practice

  Escalate all variances in the budget through defined resolution channels.

  Outcome

  Variance escalation provides increasing stakeholder awareness of budget variances and their involvement in variance resolution.

  Metric

  % of budget variances reported successfully addressed.

5Optimized

• Practice

  Auto-manage budget variances with a continual focus on reducing both cost and risk.

  Outcome

  Defined budget tolerances can be applied in a balanced and flexible way, which leads to greater business value.

  Metric

  Ratio of budgeted spend to actual spend is approximately 1:1.

• Practice

  Auto-escalate variances to stakeholders.

  Outcome

  Stakeholders are immediately informed on variances to encourage prompt action.

  Metric

  % of budget variances reported and promptly addressed.