Scaled Agile Framework (SAFe) Lean Portfolio Management Practice Exam

What is a primary benefit of participatory budgeting?

1. Allows for fixed budget allocations

2. Adapt budgets to changing needs

3. Improves cost recovery

4. Reduces overall spending

The correct answer is: Adapt budgets to changing needs

Participatory budgeting primarily benefits organizations by allowing them to adapt budgets to changing needs. This approach engages stakeholders at various levels in the budgeting process, enabling them to provide input on budget allocations based on current circumstances, priorities, and project requirements. As needs evolve—whether due to changing market conditions, new strategic initiatives, or feedback from teams—participatory budgeting facilitates greater flexibility. This responsiveness ensures that resources are allocated effectively and efficiently to where they will have the most impact, fostering innovation and alignment with organizational goals. The adaptability intrinsic to participatory budgeting is crucial in dynamic environments where stability cannot be assumed. By incorporating real-time insights and input from diverse groups, organizations can make informed adjustments that reflect both immediate needs and long-term strategic objectives. This ongoing dialogue and involvement of various contributors ultimately enhance the overall budgeting process, aligning financial resources with actual requirements.