Costing projects

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I was comparing the fantasy of Agile management to the joys of converting a house.

Firstly, no matter how tightly you plan your project, it won’t work. The tyres get punctures, the render doesn’t go off because it’s cold, the plaster sets too quickly because it’s warm and so on and so on. One of the illusions that computers peddle is that values are fixed and unchangeable. Over years of experience one discovers that an apple this year is not the same as an apple last year: it may be smaller, sweeter, less common and so on and so forth. In the same way, programmers get ill, libraries get updated, life turns out to be a little difficult. It’s fine if you’re building on a greenfield site, but in the real world you may not be.

So we are dealing a non-representative series of events. Estimates are based on normal – that frictionless set of billiard balls or that perfectly rational economic creature… Life is imperfect, unbalanced, frustrating, and driven by chance. People on the top want to believe that it is driven by skill. They wish to confirm that it is their qualities that have given them their privilege, and others’ failures that have denied it. When talking about becoming a premier league footballer, people are willing to admit that some people are born with more talent than others. You rarely hear the fact that given a couple of X chromosomes, you’ll never make it. One sperm over another. Your chances ruled out, just like that.

Given the innate unpredictability of life, you need a reserve fund to cover the likely overruns in time and cost and temper whenever you’re planning a project. You also need a contingency plan.
This is one of the things I find most interesting. What do you do when a project has overrun? At what point are you prepared to say “pull the plug/cut the costs”?

It is my belief that life is much simpler if you have a hard deadline, chosen in advance, such that when you go over it, the project is pulled automatically. I would be curious to see how many things would get sacrificed if you knew that at fifty per cent above the original estimate, or at twenty per cent above the original time, consequences dropped in.

When I was in a partnersip, I rekember bidding for a contract. We honestly told the buyers “It’s not possible to do y in the time, but we can do x”. We didn’t get the contract. We were correct, of course, but people want to hear that they can do y in time t. Anyone who says “No” will lose out to anyone who says “yes”. You therefore need heavy penalties for misleading on contracts.

There is less temptation to gain a contract bby being over-optimistic if you know there is an automatic penalty for getting it wrong. But how may customers prefer illusions to truth?

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