Management reserve is the part of a project’s budget that is set aside in case something unexpected happens or the project’s scope changes in a way that could affect the project’s timeline or budget. This reserve is usually kept by the project manager, who doesn’t tell the project team or other important people about it unless they need to.
Management reserve is different from contingency reserve, which is the budget set aside for known risks that have been found during the risk management process. Reserves for contingencies are set aside for known risks, while management reserves are set aside for unknown risks that could come up during the project.
The goal of the management reserve is to make sure that the project manager has enough resources to handle any unplanned events or changes in the project scope that could affect the project timeline or budget. It is an important tool for managing projects well because it protects against the unknown and makes sure the project can be finished successfully even if something unexpected happens.
Usage
It is used in project planning / schedule management
