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Adding a general contingency amount does not explain which uncertainty it covers. Poorly managed contingency can conceal scope growth or disappear before a critical need arises. Sponsors should make its purpose and the conditions triggering its use visible when the plan is established.
Decision framework
Select consequential financial uncertainties such as another translation review, extended follow-up or an alternative supply route. Record a rationale, plausible range and approval owner for each. Do not hide known but unpriced work in contingency; that activity belongs in the defined baseline scope and cost estimate.
Worked example
For example, a budget contains contingency even though additional site activation is already part of the intended scenario. The team moves that work into the baseline estimate instead of charging it to the reserve. Exposure to a genuinely uncertain repeat shipment remains separate. Contingency then serves uncertainty rather than making an optimistic base budget appear artificially low.
Implementation checks
- Connect contingency use to a specified event or decision rather than managing only the remaining aggregate balance.
- Explain which assumption a released amount resolves and what remains available for other identified uncertainties.
- Distinguish authorisation to release funds from approval of the operational change where those are separate decisions.
Acceptance and boundaries
Accept the arrangement when decision-makers can distinguish baseline expenditure from allowance for uncertainty. Numerical ranges need justification from study information and informed judgement. This example does not prescribe a standard contingency percentage; financial controls and governance should be determined for the particular trial.
Frequently asked questions
- Can contingency cover every delay automatically?
- Assess intended purpose, consequences and authorised approval; it is not an automatic spending entitlement.
- Does an unused reserve prove successful management?
- Not by itself. Required activities and the management of underlying risks also matter.