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September 09, 2007 | Comments: (0)
Deferring technology costs
Dear Bob ...
"More bridge lessons" (Keep the Joint Running, 8/25/2007) included the statement, "Your job isn't to be right about all of this, then to say I-told-you-so when something goes wrong."
But saying "I told you so," is so much fun!
Recently the company where I work found out that the chief engineer wasn't just trying to spend money.
We have been trying to get fiber the last 100 yards to a key site, which while formerly privately owned, is now state property. We will now have to get an easement for access. It will take months.
There is a temporary solution, which is piled high with politics. Won't happen until just about the time the other is ready to go.
Our plan for a backup link always had been a microwave link, which keeps getting put on hold due to other financial considerations. Until, that is, management came to the conclusion that a critical program, which requires the direct link from our main office to the key site, just isn't going to happen without the microwave link.
Which of course is now more expensive than it was 6 months ago.
He told them so!
- Spectator
Dear Spectator ...
Yup. It's a story that plays out over and over again in corporate America: Pay it now or pay much more later.
Somehow, later usually seems much more attractive.
While a common excuse is that delay results in lower costs (usually due to either the continuing decrease in cost of information technology or avoiding the cost of an unneeded upgrade) it doesn't really play out that way.
Even when the cost of technology drops, delaying the expense delays the business benefit too. Delaying upgrades results in more expensive upgrades - the more versions skipped, the more the upgrade ends up looking like a conversion.
Pay it later can make a lot of business sense, though. For the decision-maker, that is. It's a way to borrow against the future that doesn't show up on the balance sheet. This means the decision maker can look artificially good while leaving his/her successor holding the bag.
In a sense, it's a legal way to cook the books.
- Bob
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Posted by Bob Lewis on September 9, 2007 06:28 AM
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You missed something, Bob. "Until, that is, management came to the conclusion that a critical program, which requires the direct link from our main office to the key site, just isn't going to happen without the microwave link."
Why was it management who came to that conclusion? Does the system engineer not know what applications are critical to the business? Isn't the system engineer the one who would have told them what won't function without the link?
I don't want to detract from the point you're making, which is entirely valid. But in this example it looks like someone in IT had a perfect pitch they could have made, and didn't.
While I agree it is often shortsighted to put off a project, most companies don't have the capital to invest in every good idea that comes along. Part of being an effective manager is investing limited resources where they will deliver the greatest impact. Many (most?) people only see the scope of their own jobs and wonder why investments aren't being made in their projects. They forget that no matter how compelling a business case one has, there may be several other projects with even more compelling business cases, and those should, rightly, get funded first.
Posted by: Alan Earnshaw at September 12, 2007 11:23 AMIt would appear to me that IT clearly stated the business case for the link, including the "backup option" of microwave. Yet, it wasn't until someone higher up decided that it was critical, that the approval to obtain it was made.
There is often the suggestion made that the reason that IT does not get what it needs in a timely fashion is because of a lack of business case or a general lack of articulation about the issues. While this can be the case in some situations, I have seen that a greater percent of the time, the issue is that facts do not hold as much weight as opinions, and until you have managed to impact the senior decision maker's opinion (usually described as "management decided the issue was critical"), the project will simply stall...
Let's not put the blame on IT needlessly...
Posted by: ASB at September 13, 2007 03:03 AM|
Three books. Three ways to change the world, your life, or at least Bob Lewis' bank account. Leading IT: The Toughest Job in the World distills the world of IT leadership into eight learnable skills and gives you concrete, practical techniques for each one of them. Bare Bones Project Management: What you can't not do makes project management manageable, even for first-time project managers with no formal training in the discipline. ManagementSpeak: What managers say/What they mean … well, it won't help your career, and won't make you a better manager. Mostly, it will make you chuckle, guffaw, and maybe even chortle. Make friends - it's the perfect gift for anyone who has ever suffered through one of those meetings. Order your copies today! |
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