Friday, December 24, 2010

A Christmas Business Case

“Give to receive in double” is on the top of my list of phrases to avoid.
It sounds like an investment, doesn’t it? You invest a certain amount and you’ll get double that in return! You could even write a Business Case for it easily, as you have the ROI computed already and all. And as Christmas is a perfect time to give, you could write a perfect Christmas Business Case, right?
I really hope this doesn’t make any sense to you. It doesn’t make any sense to me and this is why I don’t like this phrase. But I do like Christmas - without a Business Case.

This may be a clever take on that phrase, but what does it have to do with Project Management?




Let's start with a story
Well, you may have noticed that not everything in Project Management is black and white. Different people have a different approach towards the world around, Project Management included. The phrase "Give to receive in double" can be someone's preferred phrase and that doesn't mean I'm right and that someone is wrong. But even so, there are some things that are either right or wrong.
This may seem obvious but I have a *real* story for you that shows otherwise - that some people really believe that Project Management really is in black and white. (I’m not sure of the basic facts like dates and stuff so I’ll ad lib a bit on this *real* story and turn it into my story for this post only). And it goes like this:
Once upon a time there was this company that built airplanes. And they found out that their airplanes had some problem that could eventually cause an airplane to crash. So what did they do? Cost-benefit analysis, of course! They evaluated the cost of calling in all the airplanes and fix the problem. If they didn’t do it, there was the risk of eventually being forced to pay some compensation to crash victims and their families. As doing nothing was cheaper, that’s what they did: nothing.
But a plane did crash due to this problem. And somehow the word got out. And in the end they had to pay a huge amount of money to the victims' families...
Gulp…

The irony of this story...
...is that their cost-benefit analysis didn’t work. The main purpose of this analysis is to evaluate the impact of doing something. But...
They chose the most expensive scenario...
...because they got their premises wrong,...
…did a poor risk assessment...
…and got the wrong results.
Sorry but I couldn't resist the temptation of using a picture from "The book of nonsense" because all this does sound a lot like nonsense.
Anyway, although they probably did a very good document explaining all the math and reasoning to support the recommendation to do nothing (that probably ended with a presentation where the decision to do nothing was made), something did go terribly wrong. And that was...

...Common sense
Nothing replaces the use of common sense. You can do whatever analysis you want but please review the results before accepting them. If they put human lives at risk like in the story above... gosh, doesn’t that sound fishy to you? Fortunately for most of us project managers our mistakes don’t cost lives. But they always have a cost. Keep that in mind will you?
It's also all too easy to take the wrong conclusions. Keeping the nonsense and the irony in this story alive, one could imagine the following lesson learned for the end of this story:
"We should have kept our cost benefit analysis top secret inside the company. If we did so, the company could have saved millions in legal battles".


Bottom line
Project Management isn’t black and white. In fact, it is very colorful. So don’t expect some analysis to give you all the answers. Do your analysis but please review the results before accepting them as *true*. If you do this, who knows? Maybe...
then you could be a better project manager.

Wish you a Merry Christmas.


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    Images from http://www.santadollars.com, http://www.ohdeedoh.com, http://thenonsensebooks.com, http://www.freedigitalphotos.net (luigi diamanti) and http://www.bbc.co.uk

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